Study “proving” 49ers stadium is a huge win for the public says nothing of the sort

The sports business site Front Office Sports — originally founded by a sports management student with no journalism experience as a way to interview sports execs in hopes of landing a job with them — has a well-deserved reputation for having its head so far up the butts of team owners that it can see what they had for lunch, so I tend not to link to too many of its “articles.” But it’s hard not to take notice of one with the headline “49ers Proving Not All Criticism of Public-Funded Stadiums Is Warranted.” Oh, does it now, Front Office Sports, do tell?

Sitting in his sunlit office, Al Guido, President of the San Francisco 49ers, felt vindicated.

“We’ve proven our business case here,” Guido told Front Office Sports. “From a mathematical perspective, I don’t think you can look at this stadium as it relates to the 49ers or the city or, frankly, the larger region and say that this wasn’t a tremendous success in the first 10 years.”

This data was detailed in a study released on Monday, demonstrating that Levi’s Stadium has not only generated more than $2 billion for the local economy but has also contributed nearly $469 million in tax revenue since its opening in 2014.

So we’ve already taken a step back from the claims of the headline, where instead of the 49ers‘ stadium proving that public stadium subsidies aren’t as bad as they’re cracked up to be, we have a 49ers exec asserting that it proves it. From a mathematical perspective even! And with eye-popping numbers of $2 billion in economic impact and $469 million in new taxes over nine years, according to a study that … where does that link lead, anyway?

Head over to sportseconomics.com and we learn that “SportsEconomics is a full-service marketing research and economic consulting firm. Industry-leading Economist oversees all analysis.” Said economist is Daniel Rascher, who unlike in the case of some economic impact study consultants actually has a PhD in economics; SportsEconomics appears to be the shingle he’s been operating his consultancy under since way back in 1998, which explains how he was able to land the domain name.

As for those glowing impact findings, let’s dig into them some more:

“Projected” direct spending is an interesting term to use for the year 2022 in a report prepared in 2023. Where did that $251 million figure for projected non-stadium economic impact — in other words, spending in Santa Clara outside the stadium that can be credited to the stadium — come from?

This Report utilizes primary research (surveys and direct data gathering during the events) to estimate spending, as well as secondary research (the assimilation of data/information that already existed and was created for purposes other than this report) for non-survey based spending categories.

That’s a whole lot of passive voice there: Who’s gathering data from whom exactly, and how? It looks like somebody, probably the 49ers themselves, just asked fans to estimate how much they were spending during their visits to the stadium and then wishcasted that into solid economic projections, which — oh, look, while I was on a plane, J.C. Bradbury already made this point for me:

I thumbed through this last night. This is not how economists measure economic impacts. Basically, it uses attendee surveys (notoriously unreliable/biased) and then run through an input-output multiplier. It's not credible and no one should take it seriously. https://t.co/30SkYjRgjb

— J.C. Bradbury (@jc_bradbury) October 3, 2023

Stanford University sports economist Roger Noll was almost as harsh when asked about the report by the San Jose Mercury News, saying that while it’s “more carefully done than a typical impact study” it still “does not measure the net benefits to Santa Clara, city or county, from having the stadium.”

There’s also a weird disclaimer stuck in toward the end of Rascher’s report:

So the estimates of how much of the spending is incremental — i.e., how much is genuinely new, not just people who would have been in the area spending money anyway — is or isn’t included in the impact projections? It’s hard to tell whether Rascher here means “I acknowledge that some of this money isn’t really new, but I don’t know how much” or “This is just the new spending, there’s also non-new spending but I don’t know how much.” And if the latter, it’s hard to say how he knew, if his only data source is 49ers fans filling out surveys sent to them by the team.

Finally, Rascher also claims that the stadium created “approximately 11,840 [full-time equivalent] jobs,” which would be remarkable for a stadium that’s only in use a couple of dozen days a year; unfortunately no source at all is cited for the jobs number, so we have no clue at all what if anything that means.

I’ve reached out to Rascher to see if he can clarify some of the numbers he’s presented and where he got them, and will update this post if I hear back. In the meantime, any last words, J.C.?

This is about identifying truth. Sometimes we get things wrong, and good faith mistakes are a part of the process. Self-publishing motivated findings outside normal channels for a fee is not. You want to consult? Fine. But you have to conform to conventional research standards.

— J.C. Bradbury (@jc_bradbury) October 3, 2023

#micdrop