The Economic and Political Structure of Stadium Development

Introduction

In exemption of the prevailing controversies experienced within the economic and political nature of establishing and developing cities across the globe, the world has dictated the state of construction and development of stadiums through full or large proportion of funds retrieved from the government. Some researchers have criticized this dimension of action alongside other arguments retrieved from the communities in which politics has pushed the ideologies of public funding for infrastructural development used for private interests. Such ambiguous perception and research outcomes have become profound and relevant when determining how the stadium developments are structured. Arguments have been raised indicating that stadiums either improve the regional or local economy by making them the centers of business or devolve funds and resources within the regions where the stadiums are constructed. On the other hand, some articulations inform that the devolvement of government funds through stadiums constructions neither target the local population nor encourage their use for public benefits and convenience. The stadiums are used mainly by private institutions with personalized benefits which are huger while compared to the income earned by the government after funding the constructions. These arguments imply that there is no overview of how stadium developments have been planned and implemented within the globe. In this regard, it is imperative to review the formation and development of the stadium under the legal platforms set for the establishment of the leagues, franchises and arenas.

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Purpose

This research provides an explicit structural arrangement as envisaged by other researchers, which is prudent for developers, scholars, and players among other individuals across the globe. Essentially, there are existent gap in knowledge regarding the right arguments on the stadium development. This study provides information required to set how future constructions should be performed. This aspect implies that the government and private sectors may base their arguments on the outcomes of this study. Furthermore, it gives reasons to the donors and investors of stadiums since they understand the outcomes of the funds they isolate for its purpose. Finally, it solves the misinformation and inaccuracy of knowledge to the general public through bringing ideologies at one point where they can be sought.

Thesis

The organization of stadium development has been setup decisively as a role that the government should take part. This assumption is supported by many researchers who point out how valid the involvement of government has not only become profound in funding stadium establishment, but also raised fundamental concerns among teams, players and fans. The failure to meet the required cost of development may arrest the full achievements expected from the events. In this light, this study targets to evaluate how the development of stadiums is facilitated by their economic and political structures. Therefore, the research answers how the political and economic structures of stadiums facilitate their development. Furthermore, it provides counsel on the ambiguous suppositions raised in respect to stadium development. Finally, the study outlines the actual structure of the economy and politics formulated in regard to their development.

Definition of Terms

Stadium: It is defined as a sporting arena fitted with rows of seats used by spectators.

Audience

This study is fundamental to the manager of stadium development and the devolvement of public funding. It provides insight about how and why the stadiums should be considered as part of the strategies facilitating economic development. The players and fans also rely on the outcomes of these research findings because their participation in sports is determined by the presence of proper infrastructures and reliable sponsors.

Review of Literature

The Support of Government Funding

Selling the Game

The study conducted by Baade, Baumann, and Matheson (2008) evaluated the effects of professional sports on national economy where the development of stadiums were conjoined to its popularity and eminence. Essentially, the sporting activities such as franchises and leagues publish their sizable advantages that create an incentive to further constructions. These facilities were recommended to be at a substantial public expense. The researcher reviewed various studies from previous authors indicating that establishment of new sporting facilities improve the economy through attaining large income within the host cities. The researcher availed a study that would inform scholars about the overall achievements and strategic tactics to develop cities. In fact, economists have profound relations to the styles presented in this envisaged suppositions where stadiums and franchises associated with sporting could be used to elevate the economy. The researchers applied a regression analysis on the sales made through the legal platforms within Florida between the year 1980 and 2005. These suppositions did not support the claims developed by the research hypothesis stipulating that sporting facilities had significant economic relevance. The franchises and sporting activities were noted as strategies of lowering taxable sales than raising them. They performed two forms of studies identified as ex ante and ex post. Moreover, the use of taxable sales to evaluate the economic prevalence of the host city while determining whether the development of the facilities were coined to the economy. The data was collected from 25 years in order to facilitate the evaluation. It applied both qualitative and quantitative strategies to finalize the research tactics. Their research informed that there were no apparent economic gains of hundred millions of dollars priors to the establishment of sporting infrastructure.

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Economic Development or Economic Redistribution

In another case, Coates (2007) evaluated literature to retrieve the effects of proficient sports’ teams as well as stadiums to the people residing in the surrounding areas. The research indicated that this aspect had been addressed by copious academic and hired investigators. Essentially, the researcher addresses the problems where stadiums and arenas were developed without assigning individual responsibilities to the people for the last 20 years. These studies were oriented to boost and determine the state of economic development and redistribution brought about by the sports. The researcher paid attention to the financing processes and reviewed various techniques that should be used when seeking the monetary assistance. The evaluation of the subsidies was followed by the public economic impact where further research was performed to avail how the public was affected. This section evaluated the ways of creating jobs and income as well as measuring benefits. The researcher introduced the consent of the public on the use of their resources through voting to approve the construction of stadia. Eventually, the research was completed after the suggestions of various topics for future studies. The research found that the use of franchises and stadiums as a mean of facilitating development in the local regions was not viable. This aspect was valid regardless of whether the analysis involved the use of job growth or income. Coates indicated that there might be considerable public advantages arising from such facilities even though they were not sufficient to facilitate large-scale funding. However, these aspects were combined with surplus from the consumers to provide efficient outcomes.

It Takes a Village to Build a Sports Facility

In another case, Greenberg and Hughes (2011) argued that the cost of constructing and maintaining stadiums to hold major leagues had been increasing within the USA. Therefore, the researchers conducted a study hypothesizing that the citizens paying tax would use a higher amount of money to sustain these requirements in the future. The researchers argued that fifteen billion dollars were used to maintain and construct sporting facilities in the 1990s. In 2003, twenty-one facilities to handle major league events used 16 billion dollars to handle similar requirements. The use of a similar amount was used in the construction of 65 sporting facilities in the previous decade. However, the prevailing state of the economy led to the release of diverse attentions and arguments regarding whether this funding should be generated by the government. These differences were triggered by political and public resistances, limitations of governmental capabilities, and ignorance about the appeal of the construction projects. Therefore, the researchers studied the reasons of the community resistance through assessing the benefits attained by the surrounding people due to the presence of the stadiums. The main assessment was performed in regard to the tax rates perceived from these regions. The study was advanced through comparing the relevance of the sporting facilities in regard to their geologic locations where productivity was high in the urban areas. The study evaluated such stadiums as Camden Yards, Jacobs Field, Coors Field and Staples Center. The Sports Comm evaluation showed the tactical construction of institutionalized-stadiums by the colleges. In other places, the researchers retrieved literature on the city developments based on the sporting activities as exemplified by the Dubai Sports City and Qatar. The analysis was performed extensively by citing examples and retrieving literatures throughout the globe. Eventually, they concluded that the development of sporting facilities introduced local and regional developments especially to the people close to the facility. However, the public might be subjected to further taxation attribute to the cost of these facilities.

Reflections on Public Funding for Professional Sports Facilities

Another case portraying the structure of stadium development is a research study conducted by Murray (2009), which addressed the controversial arguments about the appropriateness of using public funds to finance arenas, stadiums, and other additional amenities. In the United States of America and Canada, it was claimed that the franchising activities were owned privately by profit-making businesses. Primarily, the parties involved in stadium activities had requested these teams to participate in supporting its maintenance. In fact, the stakeholders argued that the public should not provide financial support to facilitate the interests of private institutions. However, the institutions dictated that the sporting activities boosted the economic prowess of the surrounding communities and therefore recommended public funding to retain the stadiums which the institution could not manage financially. In this regard, Murray examined this controversy from a liberal egalitarian manner. In a bid to accomplish this task, the researcher held the position against public funding for nonessential expenses except for extremely idealized conditions. The argument was supported through the increased frequency of debate on the prevailing funding and lack of satisfaction from the parties involved where Murray evaluated the history of the financing in USA and Canada. Also, the argument was supported by the liberal egalitarianism against the funding, economic arguments in relation to Rawls’ theories of justice, and compliance to the national conditions for legitimate public financing. However, the researcher concluded that the findings of the research might provide mixed outcomes. Therefore, the state should make legitimate conclusions regarding the public funding within these amenities.

Sport and Economic Regeneration in Cities

A research study conducted by Gratton, Shibli, and Coleman (2005) evaluated the social and economic relevance of sporting events and the appropriateness of related investments. These researchers hypothesized that the aim of the sporting investments seen within cities for the last twenty years was not directed towards the prowess of the local sports. The problem was that these investments boosted the economic state of the cities, attracted tourists, and developed foreign empowerments without addressing the involvement of the local community. In this regard, the researchers assessed various literatures and backgrounds to affirm the state of the urban development related to sporting events. In fact, the researchers accessed information from distinct location in North America where vast funding was directed towards stadia constructions. The study involved other nations and events such as the UK and Commonwealth Games Manchester 2002 respectively. Furthermore, they analyzed the long-term benefits associated to such events as Olympics, and World Student Games among others. While developing this reverse argument within the current literatures, the funds used when financing the sports’ events and the generated revenue were recorded and measured depending on worth. The study was significant for availing the gap present within the understanding of sports as a trigger for economic development rather than an attribute enhanced by it. Eventually, the researchers found that sports had reliable capabilities to provide considerable economic and social benefits for the use of the regional and local improvement. However, they identified that the economic income to the local communities had not received adequate attention from researchers.

The Economic and Social Justification for Publicly Financed Stadia

A research conducted by Lee (2002) reviewed the participation of stadia to the economic development of cities. This research was implemented due to the argument that triggered heated debates as probed by the media in regard to their public financing. A part of these arguments pointed out that the stadiums motivated the economic growth of the city and improved the social state of the communities participating in them. This attribute implied that the stadia participated in reviving cities within North America. However, some researchers argued that this entire supposition of cities’ development retrieved from the stadia establishment was a cynical and mythical satire to the social and economic development. They indicated that the financings only served to tax the public higher while the facilities were used mainly by the private institutions. The maintenance and construction plans were identified as political setups aimed at benefiting some private institutions. However, the facilities were concealed as a public resource benefiting the citizens. In this regard, the research was aimed at unveiling the controversy about the ownership and relevance of these facilities. The research hypothesis indicated that the stadia were not effective in enhancing direct orientation of development within the cities. Nevertheless, it had considerable benefit to them while perceived from the social-cultural perspective. Particularly, this research study would provide insight to managers and scholars in the sports sector. It would not only provide counsel to these parties to approve the public involvement in social constructions being targeted for public interest. This aspect implies that the study will be significant to these parties and the management of major leagues could instill fundamental knowledge and incite retrieved from the critics and proponents. The researcher reviewed literature from the North America debate about the construction and evaluated a case study about this stadium. The information was centered on the opposition of this idea and economic generation. This strategy led to the development of various findings, solution, and counsel solving the gap between the critics and proponents. The findings illustrated a presence of many intangible benefits that the stadia could offer to the city.

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Sport Stadia, Sporting Events and Urban Development

A research conducted by Maennig and Plessis (2009) evaluated how infrastructural projects trigger positive changes in development as a result of the upcoming major sporting events. They inquired whether such effects were driven towards attaining urban development through assessing a project in Durban. Therefore, these researchers identified whether the due effects could facilitate the use of unique architectural techniques when building new stadia. In fact, such events as FIFA were held in nations with the motivation to maintain suitable and classic sports’ infrastructure. They made arguments on the basis of the economic advantages that previous nations held during such events. The description of these economic advantages marked by the improvement of GDP from other nations had been described from other nations. It had been described that iconic structures were being made the mark of urban development before the mega-event commenced. The researchers argued from the dimension of unique stadium designs where architectural reforms were made to formulate the establishment of the venue before the FIFA 2010 in South Africa. The assessment did not only review the strategic position of the stadium, but also evaluated the plans and concepts applied to make it a local, regional, national, and international destination for the mega-events. However, the main focus of the evaluation was centered on the non-pecuniary advantages related to the events including political effects, national pride, short-term financial benefits and economic prowess. The funds applied for the construction of the stadia were far much less than the amount expected after holding the event. They concluded that short-term income or employment could not arise from the events. However, long-term achievements on urban development could arise prior to the new construction of the stadium.

Residents Perception of the 2010 FIFA

A research performed by Bob and Swart (2009) assessed the ideas and suggestions of the people surrounding the venues of the 2014 FIFA in South Africa. This study was conducted after overlooking the residents’ ideas even though they were to be affected by the sports. It was performed before the commencing the event in order to retrieve fresh reactions and thoughts at the time. The researchers were concerned that the event ought to provide strategies of reach some national goals especially because it is rare. Furthermore, other researchers seem to pay attention to the socio-economic prowess through foreign income. However, there is a usual failure to consider residents in close proximities to the planning and participation in enhancing the event. In this regard, the researchers decided to interview 100 people from each of the locations with an objective to assess how they perceive the event, its venue and impacts. A total of 200 households were interviewed face-to-face with questionnaires and questions that allowed modification and flexibility. Random selection was applied using the random table where interviews were conducted. In case the household members were absent, the interview was conducted on the neighboring household of the random selection. The results indicated that a huge population upheld the FIFA events. However, some complained on the distribution of benefits associated to the event and the effects of the stadium to livelihoods. They concluded that event managers should be equipped to incorporate the opinions of residents into their plans and involve them for positive impacts as they are affected by the occurrence of the sports.

Summary and Conclusions

The development of stadiums is centered on the funding provided through the taxation of the citizens. This funding allows people to attain some benefits and returns that cannot be compared to the actual funding made. This aspect implies that the amount used when funding the constructions and maintenance is too high. In this respect, the returns within the short run are insignificant to the funding. The funding can only be found beneficial while considered in the long-run. Other nations center the developments of their states through the development of the stadiums. They appear as sports’ cities where resources were devolved through public funding. In this respect, the development of cities is part of an attractive and architectural design initiated to facilitate economic development. It is influenced by the political desires to become competitive within the market of the major leagues where nations are chosen as centers of holding international games and competitions.

These aspects show apparently that the need for establishing connection between the thoughts of researchers is paramount. It brings the arguments together to make sensible arguments showing that public funding is not only a strategic and competitive measure for a country to undertake, but also a beneficial tactic for regional achievements and attractiveness.

References

Baade, R., Baumann, R., & Matheson, V. (2008). Selling the Game: Estimating the Economic Impact of Professional Sports through Taxable Sales. Southern Economic Journal, 74(3), 794-810.

Bob, U., & Swart, K. (2009). Resident Perceptions of the 2010 FIFA Soccer World Cup Stadia Development in Cape Town. Urban Forum, 20(1), 47-59.

Coates, D. (2007). Stadiums and Arenas: Economic Development or Economic Redistribution? Contemporary Economic Policy, 25(4), 565-577.

Gratton, C., Shibli, S., & Coleman, R. (2005). Sport and Economic Regeneration in Cities. Urban Studies, 46(6), 985-999.

Greenberg, M. & Hughes, S. (2011). Sports Comm: It Takes a Village to Build a Sports Facility. Marquette Sports Law Review, 22(1), 91-184.

Lee, P. (2002). The Economic and Social Justification for Publicly Financed Stadia: The Case of Vancouver’s BC Place Stadium. European Planning Studies, 10(7), 861-873.

Maennig, W., & Plessis, S. (2009). Sport Stadia, Sporting Events and Urban Development: International Experience and the Ambitions of Durban. Urban Forum, 20(5), 61-76.

Murray, D. (2009). Reflections on Public Funding for Professional Sports Facilities. Journal of the Philosophy of Sport, 36(5), 22-39.

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