Thursday, September 11, 2008

What are the Costs and Benefits of College Sports?

By Robert Villwock and Matthew Denhart

August is over and students across the country are making their way back into classrooms and the familiar smells of fall have begun, signifying the beginning of football season. Every weekend from now through January will be filled with exciting matchups on the field, starting this weekend with a big game in the state of Ohio as ‘The’ Ohio State University takes on Southern California. The game has several implications for both schools.

•The national championship hopes for both schools are on the line
•Future recruits will undoubtedly watch the game and make their college decision based somewhat on the result
•Stars from both sides will play as hard as possible to not only win the game, but impress NFL scouts as well

With all of the attention being put on college football, fellow CCAP research assistant Matthew Denhart and I wonder what are the costs and benefits of NCAA sports?

Sure Ohio State and USC stand to gain millions of dollars from this weekend’s matchup, but what about smaller division 1 schools whose teams don’t generate enough fans to cover the costs of putting a team on the field?

How heavily are big sports like football and basketball subsidizing the rest of the sports teams at a specific university?

Matt and I are in the beginning stages of a study that will encompass benefits and costs of collegiate athletics. The study will look at Division 1 Public Universities because they receive money from taxpayers and therefore it is important that they properly allocate those funds. Some other questions we hope to answer can be found below.

How many universities and small colleges’ athletics departments are operating at a loss and why do they continue offering sports? What are the externalities, both positive and negative, of having a sports team and what would (theoretically, of course) a company that wasn’t heavily subsidized by the government do in regards to keeping sports teams?

Also, other questions arise that we hope to answer. Do collegiate ‘student-athletes’ deserve to be paid for all of the public relations and money they bring into their respective universities? Also, what happens when incentives of big time college coaches are misaligned with the educational mission statement of the university?

The irony of the project is that Matt and I are both big college sports fans. We realize that college sports are here to stay and we are happy about that. Having said that, it is our responsibility as taxpayers to make sure that contributions to higher education are being used in the most effective and efficient way.

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