How much does the Super Bowl bring to the host city?

With the World Series coming to town for a second year in a row (talk about a competitive balance problem), there is a lot of talk about what this means for the local economy. As I have read the research that has been done, I was shocked to see that the evidence is consistent in the finding that mega-sporting events do not have a significant impact on the local economy.

I would like to think that bringing in 100,000 fans to Cowboy Stadium for the biggest American sporting event. It was estimated that these fans would inject $600 million into the Dallas-Fort Worth Economy ($200 million in direct expenditures). However, Mother Nature had other plans; during Super Bowl Week she dropped two different snow storms. Events were cancelled, flights were cancelled, hotel rooms were cancelled, and the anticipation of a large impact fell faster than when I tried to walk down my inclined driveway.

After the Super Bowl the Star Telegram ran an article about the economic impact of the Super Bowl (Article can be found here). The article reports how mayors were happy to have experienced an increase in sales tax revenues in the month of the Super Bowl. While the percentages might sound good, they actually show a very small increase in actually increases of revenues.

	Sales Tax Revenue
	Feb. 2010	Feb. 2011	% change	$ change
Arlington	5,550,239	5,800,000	0.045	249,761
Fort Worth	6,634,615	6,900,000	0.04	265,385
Grapevine	2,149,533	2,300,000	0.07	150,467
Euless	658,929	738,000	0.12	79,071
Bedford	627,649	622,000	-0.009	-5,649

While not all communities are shown, it is a far cry from the estimated $200 million in estimated direct expenditures. And while it is bigger than 0, it might not be statistically different than 0.

Yankees or Mariners?

I have a soft spot in my heart for the Mariners. While I never was a fan of their team, Seattle did play against the Angels and Royals who did hold my childhood allegiance and one time and another. And I don’t like the Yankees. I lived in NY for 5 years, and no matter how hard I tried, I just could not convince myself to be a Yankee fan. I would get visible upset when Susan Waldman and John Sterling would interrupt the normal radio program to broadcast a Yankees game (I know wish the Rangers had their own Susan and John, their announcers put me to sleep after calling out a Josh Hamilton home run). In spite of this, I will try to provide an unbiased discussion of competitive balance.

Let’s turn back the clock to 2001. The Mariners had an amazing year. Their star players were a young Ichiro, a power hitting second baseman named Bret Boone, solid veterans like Jay Buhner and John Olerud, and even had the young Jamie Moyer on the mound (by young, I mean younger than he is today. He was still old in 2001). They put together one of the best single season any major league team has ever had. They won a total of 116 regular season wins (to tie the record set in 1906). To put that in perspective, only one team had 100+ victories this season. The Phillies had the best record with 102 wins.

That same year the Yankees ran away with their division, with the second placed team finished 13.5 games back. Their 95 wins was still good, 3^rd best in all of baseball. Their team had many Yankee greats: Derek Jeter, Paul O-Neal, Bernie Williams, Roger Clemens, and Scott Brosius (from Rex Putnam high school near Portland, OR; the one time that I made the starting lineup as a kid was when we played at Rex Putnam High School. We lost)

So the question is who was a better team?

	Seattle	New York
Winning Percentage	.716	.594
Runs Scored – Runs allowed	927 – 627	804 – 713

The record at the end of the regular season, clearly indicates the Mariners where the better team. They had a better offense as they scored more runs than the Yankees, and had a better defense as well.

Now let’s look at what happens when they played each other in the regular season

	Seattle	New York
Winning Percentage	.716	.594
Runs Scored – Runs allowed	927 – 627	804 – 713
Regular Season Matchup	6 wins	3 wins

Again, Mariners are clearly the better team. But they also met in the post-season.

	Seattle	New York
Winning Percentage	.716	.594
Runs Scored – Runs allowed	927 – 627	804 – 713
Regular Season Matchup	6 wins	3 wins
Conference Series	1 win	4 wins
Runs Scored - Runs Allowed	22 – 25	25 – 22

The series only lasted 5 games, as the Yankees won the series by a 4 – 1 margin. So when it really counted, the Yankees won. But as you look at the numbers of the series, the Yankees only scored 3 more runs than the Mariners for the entire series. This series was a lot closer than the final outcome shows.

In fact, the Yankees went on to win the World Series that year and furthered the thought that the Yankees are evidence of a competitive balance problem in baseball.

By most measures, these teams were fairly evenly matched, with the edge really going to the Mariners. The main difference was that the Yankees won their games in October, and as such won, the championship. So looking at only championships as a measure of competitive balance, can skew the actually balance that exists in the league.

We are the champions, no time for losers

At the beginning of each season, fans have an honest belief that their team has a chance to win the championship. This is the year!! We will overcome the curse of the goat which Steve Bartman single handedly kept going, we will show the world that defense wins championships (i.e. we have no offense), or this is the year our prospects become superstars. Not to be the bearer of bad news, all but one of you are wrong.

Championships matter. So to argue that competitive balance exists can be an argument that every team has a chance to win the championship. And if this is true, you should see different teams win the championship each year. Using this measure which sport would you think has the most competitive balance?

Let’s look at the past 31 years and compare what percentage of teams has actually won a championship

	Won a championship	Played for Championship
MLB	63	86
NBA	28	60
NFL	47	78

My prior belief was that baseball has the least competitive balance, at least that is what I hear from my television and read on my computer. But it is clear that baseball has had a higher fraction of their teams win a championship in the past 31 years.

What about recent history. Let’s look at the past 11 years

	Won a championship	Played for Championship
MLB	30	50
NBA	19	37
NFL	25	50

Story does not change; baseball has the most competitive balance. Basketball has a much lower fraction of teams that win the championship.

While these numbers show how championships can measure competitive balance, they do not make the case that this constitutes a “problem.” Is it problematic if the Lakers, Celtics, Heat, and Spurs win the championship every year?

Competitive Balance in Sports

I am about to teach a class of undergrads all about competitive balance in sports. And to be honest, I have no idea what I am talking about. But that is okay, I’m not alone. A lot of people who talk about competitive balance and the major problem that it is have no idea what it is. In an ESPN.com poll in 2006, when asked “Which is a bigger problem for the future of Major League Baseball” competitive balance or steroids, 50.1% responded with “competitive balance” compared to 49.8% who answered with “steroids.” (see article)

Let’s be honest, as long as the Yankees have their $200+ million payroll (see payroll numbers here) and keep winning all those World Series, competitive balance will always be a problem. Or is it? How many World Series have the Yankees won in the past 10 years? The same number as the Giants, Phillies, Cardinals, White Sox, Marlins, Angels and Diamondbacks. Only one team has repeated as a champion, and they just experienced an epic collapse in September (read Red Sox).

So what is competitive balance? Is it like pornography, you know it when you see it. So what should I look for (competitive balance wise, not pornography)? If the Yankees win the World Series this year, is that an indicator?

How would you measure competitive balance in sports?