Research & Opinion - Should taxpayers fund motorsport events

[Tim.Wright]

A grand prix has a decent effect on the local economy. All the teams and spectators fill hotel rooms, eat food and generally spend money in the area. Id guess this cash injection would be larger than the government contribution to the race too.

So while the event itself might not be a winner for the track owner, it is for the country and city that its in.

There are other similar but non economic effects. If a government helps its city by creating incentives for sports, arts and other events like trade fairs etc the citizens are less likely to get bored and move out (like I did from my city). Citizens moving out generally has a bad effect on the economy.

[bhall II]

I don't know how, or even if, this applies elsewhere, but delving into the public financing of American sports venues typically reveals a net loss for taxpayers, even when the impact on the local economy is considered. While there's clearly a significant difference between a contribution of X-XX millions for an annual event and XXX millions for a stadium, facilities can host events year-round, and it still doesn't add up.

It makes sense, though. If there was money to be made from these ventures, business leaders would likely be more willing to pay for them instead of relying on public subsidies that often have strings attached. So, it's like everything else: privatize gains; socialize losses.

Personally, I don't mind the use of public funds to prop up cultural institutions that might otherwise wither and die. I just don't think that can be said of sports that are organized by billionaires, bring in billions every year, and are often comprised of competitors who have annual revenues and/or market caps worth many, many, many billions.

EDIT: Just realized I pretty much parroted ARF1's comments.