Monday, 14 May 2012

Will they never learn?! (updated)

As has been noted on this blog and all other economics blog in the country the economics of building stadiums suck. Recently I wrote,
I can't help thinking that the obvious lesson from Dunedin [with regard to the Forsyth Barr Stadium] is that if you want to inject economic life into your area don't build a stadium.

I just hope that other city councils learn from the Dunedin experience and don't try building grand new stadiums in their cities. Take note Christchurch!
It now appears no one has taken notice. The Press reports,
Prime Minister John Key has backed the idea of a "world-class covered stadium'' in Christchurch.

The size and design of a long-term replacement for earthquake-hit AMI Stadium has been the subject of much debate in the city.

Six options are on the table, and possibly more, when the consultation period ends.

They range between $40m to $145m with the insurance cheque of $143m factored in.

The cheapest option is a like-for-like rebuild of AMI which would take four years.

The most expensive is $144m, a new 35,000-seat rectangular stadium with a covered playing surface, which would take five years to build.

The Christchurch City Council's draft annual plan, which is open for public feedback, has indicated a preference for an uncovered 35,000-seat stadium on the current site.

However, the council says the option would not rule out "the later addition of a roof structure to make the ground fully covered".
Will they never learn? Lets be clear, everything economists know about the economics of stadiums tells us that stadiums do not help the broader economies of the cities or regions they are in, in fact the evidence available points in the opposite direction. You only have to look at the situation in Dunedin to get the point. Has the government and the city council really missed what is happening there?!

The Press also writes,
Canterbury Rugby Football Union (CRFU) chief executive Hamish Riach said he was "very much in favour" of a covered stadium.
Well if they are so much in favour let them pay for it.

Update: Sam Richardson has more on the Forsyth Barr Stadium in Dunedin. Eric Crampton has noted the Christchurch situation as well.


Grant M. McKenna said...

There had not been any talk of government funding for the stadium, and Christchurch residents would need to decide whether the cost of a roof was worthwhile.

"In the end, what's built and how it's paid for is largely a matter for Cantabrians," he said.

"Key" quote from the story. In other words the PM will support it so long as the taxpayer doesn't have to pay.

Paul Walker said...

The point is that no matter who pays a stadium would be a waste of money.