Do Basketball Arenas Spur Economic Development?

Brooklyn’s Barclays Center, the Nets' generously tax-payer subsidized new home, was originally sold to the borough as a showcase for starchitect Frank Gehry (who ended up not designing it). It was supposed to be the anchor of a vast office and residential complex, The Atlantic Yards, which has yet to be built and will likely be downscaled. As neighborhood residents brace themselves for monster traffic jams and noisy crowds in anticipation of its September opening, a compelling new study by Geoffrey Propheter of George Washington University in The Journal of Urban Affairs sheds new light on precisely the question that should have been addressed before ground was broken: Are basketball arenas catalysts of economic development, or not?

Major public financing for arenas began in the 1950s and 1960s as older stadiums built in the early 1900s began to show signs of age. By the 1970s, a majority of major sports venues were publically subsidized. The study notes than "since 2004, voters in five cities have supported more than $1.5 billion in tax subsidies for new sports facilities or upgrades to existing ones."