Sports team performance and revenue of out-of-stadium vending operations

ABSTRACT

Using a novel data set on daily sales revenue, we examine how the Baltimore Orioles’ performance affects a street vendor operating outside Oriole Park at Camden Yards. While fans respond positively to good team performance throughout the season, a win for the home team generally means lower revenue for the vendors outside the stadium. We find that economic benefits accruing to street vendors – and by extension to nearby hotels, restaurants, and bars – may only be maximized when the sports teams are bad, but not that bad.

KEYWORDS:

• Major league baseball
• street vendors
• sports team performance
• economic impact

JEL CLASSIFICATION:

• L83
• J48
• C51

Acknowledgment

The authors would like to thank seminar participants at the 2019 Annual Meeting of the Missouri Valley Economic Association for the thoughtful comments.

Disclosure statement

No potential conflict of interest was reported by the authors.

Notes

¹ In cities with professional sports teams, employment opportunities increase but earnings are lower for employees at restaurants and bars (Coates and Humphreys 2003).

² See, inter alia, Noll 1974; Horowitz 2007; Winfree and Fort 2008; Gitter and Rhoads 2010.

³ There was a one-time price change from $3 to $5 introduced at the start of the 2014 season. We repeated our exercises using data on the quantities sold and reached the same conclusions.

⁴ Oettinger (2001) examined sales revenue and effort choices for in-stadium vendors by similarly estimating the impact of various demand conditions. Serrano et al. (2015) found that game day demand responds positively to the quality of the teams playing. We include in our model team quality metrics that fans can easily acquire prior to and on game day.

⁵ The term ‘team quality’ includes factors like games behind, that also depends on other teams’ performance.

⁶ Our preliminary analysis indicated that other aspects of the game outcome, such as the game length, runs, runs allowed, and innings, have no significant relationship with the sale revenue.

⁷ Over the past decade, sporting venues, including Camden Yards, have continuously improved their concessions operations as well as their safety and security. Some of these changes are also relevant, such as the ones on concession menu and price. The year/month dummies help to control for some these factors, which are unobserved and/or difficult to measure. Sky conditions include sunny, cloudy/overcast, and drizzle/rain. The opponent categories are AL (American League Central and West division teams), AL East (Tampa Bay and Toronto), BOS (Boston), NL (All National League teams except for Washington), NYY (New York Yankees), WSN (Washington).