With the World Series underway, Washington, D.C.’s tourist bureau has estimated that the city will see a $6.5 million windfall from hosting games, partly from added Nationals fan spending and partly from spending by visiting Houston Astros fans:
“We are going to be welcoming business that we would not have without the World Series here,” McClain said. “You can really feel the excitement throughout the city, whether you are watching with folks at local restaurants and bars or just walking down the street seeing all the Washington Nationals gear that people are wearing.”…
“New York is closer, and so people can make that decision to come to D.C. closer to the times of the games. … If it’s Houston, it’s really just a distance thing, in terms of people having to take flights here, and so that just becomes a little bit more limiting in terms of the visitation estimate,” McClain said.
Houston, meanwhile, is excited for the $9 million windfall that the Greater Houston Partnership estimates the city will receive thanks to visiting Nationals fans:
“It’s wonderful hosting the World Series because it gives us an opportunity to show businesses and people outside of Houston what a great place this is,” Jankowski said. “It gives an image of a winning team, a winning season and enthusiastic sports fans. Houston needs images like that — not the images we saw with [Tropical Depression Imelda].”
Okay, so here’s the thing about baseball games — in fact, about all sporting events: Only one of the two teams can be the home team. Depending on how long the World Series goes, Houston will host from two to four home games, and Washington from two to three; and each time fans from one city travel to the other, they leave their home city. So while there may be an influx of big-spending Washington fans in Houston for tonight’s Game 2, there will be that many fewer people spending money in Washington tonight (and, perhaps more the point, that many more Washingtonians returning to town tomorrow with drained bank accounts); and vice versa for Friday’s Game 3 in Washington. “Let’s boost our local economies by first us sending you a bunch of our fans and then you send us a bunch of your fans!” sounds more like a design for a perpetual motion machine than a legitimate economic argument.
There is some positive impact from a World Series game, obviously: A few locals probably do increase their spending somewhat instead of just reducing their other entertainment spending by the same amount, and there are visiting media crews and whatnot who rent hotel rooms and eat dinner the same as baseball fans do. But the numbers are fairly marginal: A 2005 study by economists Victor Matheson and Robert Baade determined that “any increase in economic growth as a result of the post-season is not statistically significantly different than zero,” though they also guesstimated the economic impact at $6.8 million per home game, which is actually quite a bit more than the D.C. and Houston studies are promising.
I just got off the phone with Matheson, who says that the issue is the $6.8 million figure wasn’t statistically significant, so “the answer could be zero,” or could be more. He added that any actual positive impact could come in the form of fans traveling into the city from the suburbs to see games — “you want to be in a Houston sports bar rather than a Galveston sports bar to watch the game” — or from, say, expatriate Astros or Nats fans driving down from Philadelphia to D.C. for games and bringing their spending with them. So the ultimate economic activity numbers being put forward by the D.C. and Houston groups may not be too far off, even if their explanation of them is kind of nutty.
In any event, though, that’s all “economic activity,” which Matheson once memorably defined to me as: “Imagine an airplane landing at an airport and everyone gets out and gives each other a million bucks, then gets back on the plane. That’s $200 million in economic activity, but it’s not any benefit to the local economy.” So really the lesson here for journalists and sports page readers alike is twofold: Take the claims of tourism booster agencies with an enormous grain of salt, and always ask what the tax revenue impact will be, not just the economic activity impact. Or just use your basic brain skills and understand that you can’t make two glasses of water more full by pouring them back and forth into each other, and you can save time on reading news coverage at all.