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Are gaming and sport effective tourism strategies during economic contractions? Evidence from the performance of baseball and casinos during America's great recession

Numerous cities that were former manufacturing centers have used gaming and sports to add tourism to their redevelopment strategies. Gaming, sports, and tourism have also been touted as new tools to bolster tax revenues that plummeted as factories were closed. Gaming and sports enjoy a level of popular importance that might also make demand for them less elastic and therefore even more valuable during recessions. Sports and gaming are each a distraction and a source of entertainment that could attract tourists during a recession. If that occurs then redevelopment plans could include a counter-cyclical advantage. Research in the 1980s suggested the demand for gaming was elastic but changes in its availability could contribute to a different outcome. The interest of local and regional governments in expanding gaming options to enhance tourism levels during recessions suggests the need for newer assessments of the performance of this industry during an economic contraction. Insight into the fiscal performance of sports and gaming can help inform policy decisions regarding the value of these amenities for redevelopment and the enhancement of revenue for governments. Attendance data for professional baseball and commercial casino gross revenues were collected and analyzed for 9 years. A multivariate analysis provided insight into variations in gaming tax revenue. Baseball and gaming fared no differently from other forms of consumption during economic contractions. Supposed inelastic qualities of demand for gaming and sport that led some to believe they may be better suited to perform during periods of economic decline was not found. These findings suggest that in a recession sports and gaming may offer no hedge against declining taxes or perform better than other forms of tourism.