Has Boston Sport’s Post Season Success Led to Economic Boosts

Over the past 17 years Boston Sports has entered a relative golden age, winning ten titles across all four of its major sports teams, five Super Bowls for the Patriots, and breaking the red sox historic curse.  With this type of success it is not a surprise to see these teams consistently make the playoffs year to year. The 2016-2017 seasons though have been special as all four teams, the Red Sox, Patriots, Bruins, and Celtics made the playoffs.  It is well known that sports teams can have a impact on the local economies from which they are based and playoffs or championships can increase this impact. The question is will Boston’s success across all four sports in the 2016-2017 seasons pay off and has Boston’s consistent long term success been giving it an economic edge.

The first team to make the playoffs were the Red Sox who played the Cleveland Indians in the ALDS. Unfortunately the Red Sox were swept in three games and only one of those games was played in Boston at Fenway Park. Even so estimates show that a home post-season baseball game can bring still create an economic impact of $6.8 million. Obviously there would have been a larger benefit had the Red Sox continued in the playoffs this year but there is still to some degree a small economic impact. Over the past 17 years though the Red Sox have made multiple playoff runs including three World Series appearances and victories.  Each of these would have created a much larger boost to the Boston economy in the year they occurred, compared to the Red Sox three and out run this year, but even so the economic impact is much less than MLB boosters would suggest

(David Ortiz’s last game at Fenway at the Red Sox one post-season game this year)

The Patriots successfully Super Bowl victory was likely to have had some economic impact as well, despite the fact that the game was held in Houston, Texas. The Patriots maintained home field advantage through the playoffs and while each of these games likely raise some level of impact, it is a similar scenario to the MLB playoffs where the impact stated by boosters is very much overstated. In reality, the real benefactors of the play off runs and Super Bowls were likely bars and restaurants where people gathered to watch and get food for the games. This likely does not lead to a necessary increase in the economic impact though but rather a shift in money that would have been spent in the region anyway. As such, the long run story looks similar to that of the Red Sox, with the economic impact being existent but not to a seriously significant amount.

(Tom Brady hoist his fifth Lombardi Trophy after winning Super Bowl LI this year)

Finally, there is the Bruins and Celtics who are both just starting there play off runs now. We don’t know for sure how far either team will make it but even in the best case scenario of making it to the finals large economic impact seems unlikely.  The Greater Boston and Visitors Convention Bureau estimates that each Bruins playoff game can bring in $5 million, but this again is accounting for restaurants, bars, and retailer merchandise which largely represents shifting of leisurely consumption rather than increased consumption.  For the Celtics it was estimated that there three home games in the NBA finals in 2010 brought in $12 million.  These were finals games though, and likely fall under the same overestimations as the other games, and regular playoff games are likely to have a less significant impact. The long run holds less for these teams as well as there post seasons have not been as successful each having only two finals appearances and relatively shorter play off runs over the years.

              (Isaiah Thomas in Celtics win over Golden State)

Overall while Boston sports has had great success this year and over the past 17 years it has not seen a large economic boost as a result. Between how often games are actually held in Boston and the realistic amount of economic benefits they really generate major league sports playoffs do not benefit the economy in a largely significant manner.  Even if it does not make Boston richer, it certainly makes all of New England a lot happier to see all of there teams in the play offs.

 

http://college.holycross.edu/RePEc/hcx/Matheson_WorldSeries.pdf

http://www.bostonhospitalityindustry.com/2010/06/nba-finals-brings-big-economic-impact.html

http://www.bizjournals.com/boston/blog/bbj_research_alert/2013/06/bruins-playoff-run-a-boost-to-boston.html

http://tuinnovates.com/2013/01/24/the-economic-impacts-of-playoff-appearances-super-bowl-appearances/

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3 thoughts on “Has Boston Sport’s Post Season Success Led to Economic Boosts

  1. chipdoherty

    Great Post Matt! While the numbers do suggest a relatively insignificant impact that the post season has on the local economy, I feel there might be an additional impact beyond the numbers that is worth noting. The continued success of all four clubs has resulted in Boston developing an identity as a professional sports powerhouse. Therefore the impact of a deep post-season run goes beyond just that season but spills into the coming years. Bostonians have grown accustomed to success and expect to win when they attend games or watch with friends at a bar. I would guess that this has a strong impact on the economy throughout the entirety of the year.

    Reply
  2. emmawarren18

    Matt, I think you did a good job at explaining the substitution effect that occurs with sports. For the most part, fans at these games are locals and so their money is used at these venues rather than say a movie theater. In addition, I think you are right to say there is little overall economic impact on the Massachusetts economy because even if teams make the playoffs, there is a seating capacity, and most games for Boston teams are filled to capacity anyway. The additional money could therefore only potentially come from increased ticket prices during playoffs.

    Reply

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