I read the following posted by John Whitehead over at the Environmental Economics blog. Some TSE readers may find it to be a useful discussion tool for the classroom.
TOPICS: Sports Economics
SUMMARY: Some Minnesota Vikings fans believe fandom is priceless. According to economists, it’s worth $530.65.
CLASSROOM APPLICATION: The article summarizes “Estimating Local Welfare Generated by an NFL Team under Credible Threat of Relocation” by Aju Fenn (Colorado College) and John Crooker (University of Central Missouri, Southern Economic Journal, July 2009. The article is background reading for a lively classroom discussion about the value of NFL franchises to cities and their inhabitants, and how economists measure these values. Considering measurement, the article touches on the paper’s methodology, namely contingent valuation, and criticisms of this methodology.
1. (Introductory) What are the sources of value of an NFL franchise to a city?
2. (Advanced) What methodology do economists use to measure the value to a city of an NFL franchise?
3. (Advanced) Should cities and states finance the construction of NFL stadiums? In particular, should Minnesota finance the constructions of a new Vikings stadium?
Reviewed By: James Dearden, Lehigh University