Economics of MLB All-Star Game
The football season has come to an end with the Pittsburgh Steelers's victory in Super XL and many sports fans are beginning to look forward to the baseball season. In particular, the city of Pittsburgh and all Pittsburgh Pirates fans will prepare for a decent season (hopefully) and the 2006 MLB All-Star game to be played on July 11th at PNC Park. In an article I read from the Pittsburgh Post Gazzette, city officials are expecting an image boost as well as a major (and very much needed) economic boost from the game and week-long All-Star festivities. The city is currently facing a $78 million deficit and, with estimated revenue numbers from the past 2 All-Star events at $85.6 million for Houston and $50 million for Detriot, hopes to dramatically better its financial situation. However, repairs, landscaping, construction, and many other beautification projects must take place in order for the city to host a successful (or even decent) event. No doubt such projects will generate jobs, but is the city able to fork out the money without guarantee that it will break-even or profit from the game? I believe that Pittsburgh was given the most excellent oppurtunity to recover from its economic slump through the 2006 MLB All-Star week. The Pirate ball club and PNC Park will be making big bucks from the rise of season ticket holders who purchase the package just for privelleges at the All Star game and from the pricey All Star game tickets. However, most of the revenue from the game will not come directly from PNC Park or the Pirates club, but as a result of the trickle down effect. For example, many area hotels, businesses, airports, parking vendors, etc. will generate a reasonable amount of profit.
1 comment:
This sounds all too familiar for someone who has lived in Cleveland. Yes, an All-Star game is something that can be quite the draw for a city, but I don't see it being the magic bullet to fix any kind of budget shortfall in Pittsburgh. Like Cleveland, the city is in a transition period between industrial labor being dominant and a major service economy being established. Budget shortfalls like this are a long-term problem to be tackled - no short term fix can be effective enough to solve the city's ills. Many thought the same thing when Cleveland hosted the '97 All-Star Game - at the time, Cleveland struggled with a 200 million dollar shortfall in the schools alone - but the revenue generated from the events was too quickly used, and was inadequate to put a dent in the debt. Also, the revenue numbers for a Pittsburgh All-Star game should be closer to Detroit's than Houston's, given the closeness of the market sizes.
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