Impact of New Minor League Baseball Stadiums on Game Attendance

Article excerpt

Abstract

More than 100 new minor league baseball stadiums were built in the 1990s and early 2000s following the opening of several successful new venues in Major League Baseball. Sports economics literature suggests that the economic impact potential of new stadiums is overstated because attendance gains from new stadiums are short lived (i.e., a novelty effect). This study examined the impact of new minor league baseball stadiums on annual attendance using attendance data from 101 stadiums opened between 1993 and 2004. Results indicated that attendance levels attained the first year a stadium opened increased only slightly in years 2-5 as average attendance in year 5 was only 0.2% higher than year 1. For stadiums built to replace existing venues, attendance levels were 74% higher in year 5 of a new stadium compared to the final year at the old stadium. Attendance increases were greatest for teams competing in Independent and Class A leagues.

Introduction

A surge in construction of new sports stadiums occurred during the 1990s and carried over to the beginning of the 21st century. The desire to build new stadiums was fueled in part by the success of baseball stadium projects in the early 1990s in Baltimore, Cleveland, and Arlington, Texas. Baltimore's stadium, Oriole Park at Camden Yards, received great notoriety for its architectural design, a design that was a departure from the massive multi-purpose stadiums built during the 1960s and 1970s and a return to a more intimate facility that could be found during the first half of the 20th century. Characteristics of many of these new venues included "retro architecture" in which the physical appearance of a stadium resembles ballparks from the early 20th century, expanded retail and dining options, and interactive activities for patrons of all ages.

The stadium construction trend has been observed in minor league baseball, too. A review of minor league baseball stadium directories on the Internet (e.g., http://www.minorleaguenballparks.com, http://www.ballparksofbaseball.com, and http://www.baseballparks.com) and the annual publication Baseball America Almanac found that more than 100 new minor league baseball stadiums opened since 1990. Many cities view new stadiums as a local economic development vehicle, a means of enhancing a city's image, or a form of public good intended to add to quality of life.

This study examines the effect of new minor league baseball stadiums on annual attendance in markets where new stadiums have opened during the period 1993-2004. A literature review of relevant research in sport economics and services marketing is presented to provide context for the study's research questions. Attendance data at stadiums opened over a 12-year period were analyzed to determine whether new stadiums lead to short-term or long-term attendance increases. Also, the question was addressed of whether the relationship between a new stadium and annual attendance differs depending on the minor league classification in which a franchise competes.

Literature Review

Benefits of Stadium Development

New sport stadium development projects are often promoted for their potential to create economic and intangible benefits for communities and teams. Developers, team officials, and other people behind proposed stadium developments tout the potential economic impact a new stadium can provide to the immediate area in which a stadium will be built and the city as a whole. Proponents often point to the jobs a new stadium will create, both at the stadium itself and in surrounding retail and service establishments, because of the presence of a new stadium. Economic activity created by attendance gains at a new stadium and the increase in the number of businesses nearby could generate additional tax revenues. The likelihood that a stadium will contribute positive economic impact is enhanced when it is part of a larger project that includes year-round businesses developed in conjunction with the stadium (Siegfried & Zimbalist, 2000). …