As you might discern from the topics I’ve written about thus far, I don’t care that much about sports. I am familiar with the rules of most commonly-played ones in the U.S., and enjoy watching games sometimes, particularly major events like the World Cup. Having been born and raised in Seattle, I was of course excited about the Seahawks’ avenging victory over the Patriots at the 2026 Super Bowl after their defeat 11 years earlier. I participated in a fantasy league for a couple of years, and even won once, but viewed it more as a game in itself than as an opportunity to follow sports more closely. All this is to say that, as a disclaimer, this post is coming from someone who has a general affection for his home teams and sometimes watches the big games but doesn’t follow much outside of that.
You may get a lot, a little, or no enjoyment at all out of sports, or a lot out of some but none out of others, but if you set aside your feelings, how much benefit do you get from the home team in your area doing well vs. doing poorly? A couple more personal anecdotes that help explain why I thought of this topic. First, when I was young, the Seattle SuperSonics were sold from one billionaire to another and relocated to Oklahoma City after local governments didn’t use hundreds of millions more taxpayer dollars1 to build a big new arena. This dampened my already-meager enthusiasm for sports, and made me view it through more of a mercenary lens. Second, a few years ago, I was living in the D.C. area and happened to go to the only game in the last 4 years where the Wizards beat the Celtics. Some of my friends were Celtics fans, which is why we were there2, but there was a deal where if the Wizards won, I would get free items from some sponsoring restaurant. Naturally, as the Celtics weren’t promising me anything, I went with my self interest and was richly rewarded for the home team’s victory.
Which brings me back to the question of this post: even if you don’t care much about your home team (as I didn’t about the Wizards), do you still want them to do well? As shown by the SuperSonics example, stadium construction and wooing teams to an area can cost a lot of taxpayer money that could otherwise go towards useful services you would benefit from. However, since the comparison is between the home team doing well vs. poorly instead of having a team vs. not having a team, this actually favors having a team that does well since the increased economic activity from more people going to home games (including bandwagoners from out of town) can generate additional revenue through sales taxes, property taxes, and other sources. Then again, a more successful team might require a bigger stadium, or more maintenance in general. Also, when a team succeeds, how much of the added value accrues to the local region instead of the players and owners? Tickets and merch get more expensive, while traffic and general congestion increases.
I asked Claude to dig up some literature, and the findings are genuinely mixed. The most optimistic result is Davis and End (2010), who found that a local NFL team’s winning percentage had a significant positive effect on real per capita personal income, on the order of $200 per person for a jump from zero to eleven wins, which they attribute to mood rather than merchandise. But that result is contested: Victor Matheson’s reanalysis found the Super Bowl effect was about a third the size earlier work had estimated and not statistically significant, and a parallel study of college sports found that winning seasons actually reduced per capita income growth in smaller college towns. Meanwhile, whatever gains do exist tend to get captured rather than shared. Super Bowl champions raised ticket prices around 12% the following year against a 6.4% league average, and when the Bucks won the 2021 title, a $57.6 million headline impact produced roughly $3 million in taxes overall, of which under $200,000 reached Milwaukee County and nothing at all reached the City of Milwaukee, which spent more policing the victory parade than it took in.3 Most people (myself included) root for teams because of some emotional connection, which this doesn’t change. However, unless you already care, there isn’t a strong economic case to support the home team where you live. As someone who was at Penn Station the moment it happened, I had fun seeing New Yorkers go nuts over the Knicks win, but the fact that people destroyed a bunch of vehicles and property afterward shows how much of a mixed blessing victory can be.
Footnotes
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well over a billion now adjusting for inflation. ↩
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it was brutal seeing way more Celtics fans than Wizards fans on their home turf. ↩
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my favorite finding, and a fitting one given where I grew up: Humphreys and co-authors studied property values after the SuperSonics left Seattle and the Hornets left Charlotte, with both arenas still standing so the team effect could be separated from the building effect. Condos near Key Arena appreciated 6–7% more after the team left. ↩