Study Finds NFL Inflates Ten Fold the Value of Hosting Super Bowl

As the Indianapolis Super Bowl Committee is in New York City no doubt offering anything and everything to the NFL for yet another chance to host the big game, the Fiscal Times reports on what a bad investment the Super Bowl is:

Don’t believe the hype: Despite predictions of a huge economic boom, this year’s Super Bowl is shaping up to be more of an economic dud.

Sports economists say that mega-events like the Super Bowl rarely bring in anywhere near the $500 million to $600 million promised by the National Football League. This year’s game faces the additional hurdles of the region’s recent frigid temperatures – although Super Bowl Sunday is shaping up to be comparatively warm – and the fact that the participating teams (and fans) are based so far away.

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In a detailed analysis in The Economics of the NFL: The State of the Art, sports economists Robert Baade and Victor Matheson looked at the impact on the host cities of more than 25 Super Bowls. They found that the actual impact of the big game usually comes in at one-tenth of the amount promised by the NFL. That would put a more realistic estimate for this year at around $55 million. That’s before taking into account the cost to New York City and north Jersey governments of hosting the event, including infrastructure outlays as well as marketing, security, and cleanup costs.

“The economic impact for the local community is really business as usual for these events,” says Philip Porter, an economics professor at the University of South Florida, who has studied the fiscal impact of sporting events for more than 15 years. “The Super Bowl doesn’t do anything more for the economy than a high school girls’ volleyball tournament.”

Events like the Super Bowl can actually have a documented “crowding out effect” in which local residents leave the area and potential tourists make other plans because they don’t want to deal with crowds, traffic, and other annoyances. During the Republican National Convention in 2004, for example, attendance at Broadway shows fell by more than 20 percent, and the city reportedly lost about $19 million in productivity due to congestion and other inconveniences.

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