Heavy Lifting - thoughts and web finds by an economist
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Saturday, August 28, 2004
Here Jerry Jones claims that Arlington will get a big boost in name recognition by hosting the Cowboys. I don't think the benefits are as great as he predicts. I ask plenty of people outside of Texas where the Cowboys play now - very rarely is the answer Irving, Texas.
Proponents of the stadium in Arlington claim that the economic benefits of the stadium are tremendous, what with tourism and associated spending. However, there has been nary a peep of protest from Irving about the prospect of losing the Cowboys. Maybe that is a signal.
The story contains a little nugget which blows the whole "stadium = tourism" hypothesis out of the water:
The Cowboys brand has helped the Irving Convention & Visitors Bureau recruit new meetings to town, said Maura Gast, head of the bureau. Hotels attributed 4,215 room nights last season to the Cowboys, Gast said.Only 4,200 hotel room nights attributed to the Cowboys? Hard to tell from the writing of the story whether these additional room nights include out-of-towners going to Cowboy games or only the Texas Funeral Directors Convention and the like. If the Cowboys account for only 4,200 hotel rooms (okay, 4,215) in Irving, it is no surprise that the city of Irving is not crying over the possibility that the Cowboys will leave.
There are approximately 5,000 hotel rooms in Arlington, so the Cowboys will lead to one extra night a year for the city's current hotel capacity. If Arlington numbers were similar to Irving, there would seem little motivation for a big hotel chain to come to Arlington to build a three or four hundred room hotel if there is already excess capacity.
At a price of $100-$150 per night, the city of Irving is generating a whopping $420,000-$630,000 per year in hotel revenue from the Cowboys. Even with associated spending by hotel guests at the proverbial restaurants and bars, it seems unlikely that the economic impact of the Cowboys reaches anything near $250 million per year.
Predictions vs. History? My money is on history.
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