The consistently interesting Drake Bennett writes :

…a few scholars have started to suggest that there may indeed be another kind of benefit from big-time sports. There?s a catch, though: the team has to be good. In a forthcoming paper, economist Michael Davis and the psychologist Christian End say that having a winning NFL football team increases the incomes of the people who live and work in its hometown by as much as $120 a year. And while the study doesn?t identify exactly what causes the boost, the authors point to psychological literature suggesting that winning fans are at once harder workers and bigger spenders. In short, buoyed by the team?s success, we work longer hours, take bigger risks, and shop more avidly, all of which helps the local economy.

I have a simple hypothesis. Winning sports team cause local fans to feel better and thus to spend more money. Most importantly, consumption tends to be local and thus the spending shows up in the city of the winning sports team. Saved funds, in contrast, are invested but banks and securitization make these funds mobile. Savings will help the national or international economy but not the local economy so much.

Since more savings would be desirable, the best outcome is if no team wins, if a small city team wins, or if the victory is uninspiring. Detroit vs. San Antonio, anybody? That?s what the American economy needs.

Alternatively, you might think that the economic boost comes from greater confidence, higher labor supply, and other supply-side effects. Then you should root for the teams from the largest cities (Los Angeles , New York, Philadelphia ) and most of all you should root against the Washington Wizards.

?marginalrevolution.com