Tuesday, September 9, 2014

The Return of College Football

Alexa Klotz
Mrs. Straub
Economics
7 September, 2014


The Return of College Football

Fall is the start of many changes here in the United States. Leaves change their color, the temperature drops, seasons change, and everyone anticipates one thing; the start of the college football season. Year after year people come together to celebrate their favorite college football teams. This means those die hard fans traveling all over the country to watch their team's progress throughout the year, and surrounding businesses bringing in lots of money. College football helps the economy out tremendously with bringing up the business of local hotels, restaurants, and shops, while also selling gear and tickets to fans.
These fans are constantly having to deal with opportunity cost when deciding to go to games. Students give up studying for exams in order to go to these games, while parents may be giving up the chance to either be working or spending quality time with their children. While they may be missing out on these other things, it is indeed a plus for the economy for them to be attending these games. According to economist.com, college football generated 2.4 billion dollars in the 2012-2013 season. Tickets to games are a huge resource that are scarce. People are always wanting seats to that big game, but that doesn’t mean they are always going to get them.
The Economics of College Football  A Look At The Top 25 Teams  Revenues And Expenses.png
Figure One: Expenses and revenue of college football teams

The most notable thing to take away from this chart is that Alabama spends the most on its football program for any university. But that investment has paid off with Alabama winning 3 championships in the past 5 years. Although the team spends the most on their program, they do not bring in the most revenue. The University of Texas made the most revenue with over $103 million dollars. Collegiate Licensing Company stated that Texas was the top selling institution for CLC licensed products for the eighth year in a row. Michigan also makes more revenue than Alabama, but sold less merchandise than Alabama. So what was it that put Michigan above the Roll Tide? Michigan receives royalties from the Big Ten Network. What’s most interesting though is that Boise State has been able to make a higher net income than larger schools such as Northwestern and Louisville, while investing a way smaller chunk of money into their program. This just shows that some teams earn economic success by spending large amounts of money, while other teams develop licensing contracts, and some spend reasonable amounts of money and still generate good feedback.
College football doesn’t just bring people together to cheer on their favorite teams, but it really does boost up the economy. These teams generate a lot of money that will not only help out their school, but also their surrounding community when traveling fan bases buy merchandise, food and book hotels. College football is more than just touchdowns and celebration dances; it’s about people with differences coming together to build a better economy.
tickets football.png
Figure Two: Breakdown of Revenue by Team









Works Cited

"The Economics of College Football: A Look At The Top-25 Teams' Revenues And Expenses." Forbes. Forbes Magazine, n.d. Web. 8 Sept. 2014. <http://www.forbes.com/sites/aliciajessop/2013/08/31/the-economics-of-college-football-a-look-at-the-top-25-teams-revenues-and-expenses/>.
"ncaa revenue." ESPN. ESPN Internet Ventures, n.d. Web. 7 Sept. 2014. <http://espn.go.com/>.

"Wildcat formation." The Economist. The Economist Newspaper, 8 Feb. 2014. Web. 8 Sept. 2014. <http://www.economist.com/news/united-states/21595967-why-college-football-players-want-unionise-wildcat-formation>.

19 comments:

  1. This comment has been removed by the author.

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  2. I love to watch college football and I go to a lot of the games so this really contacts with me. The pregame when you go out and stop at every bar you see to get a soda and a burger, you end up spending a lot of money. You used great charts and tables to show the money that is spent and the money that they receive. I learned a lot too while reading this piece. Good job!

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  3. I found it very interesting that Alabama spends the most money on their team to be the best, but they still don't bring in the most revenue. In fact they are almost $25,000 behind the highest revenue. Alabama also has a lower revenue than Michigan, but Alabama has much more merchandise sales due to the fact that Alabama fans want to rep a high winning team.

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  4. I think it is something positive for the economy and also negative at the same time. Not only are people coming together but the colleges are also making billions of dollars in the process. Athough some colleges are investing a lot of money for their team, their team might not get the resuts they want resulting in a bad economy. However, it does sometimes pay off when the team you pay a lot wins a lot of championships. Which would aslo boost the economy.

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  5. College football has a huge impact on our economy as well as all the other NCAA sports. Nearly every school makes money off of college football but they don't always make a profit on other sports, so football helps fund many of the other sports. There has been a lot of controversy about the players getting paid for what they do since it is treated like a job. What do you think? I really liked how the paper was set up and the organization and the evidence was clearly there to prove your thesis.

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  6. I always tend to forget about those die hard fans that go from state to state in our country to follow their favorite teams. Thus bringing in a lot of money for our country, it is interesting to see how America's past times tend to help our economy more than simply raising money. It was a great idea to use some graphs and not only that but it helped be really connect to the writing and understand fully what teams spend the most. Most would think the badgers would spend the most on football but that is probably just because we are from Wisconsin, you always have to take into account the other states and teams just as much. Overall this post was very helpful in understanding how the scarcity of tickets and our hobbies really affect our economy.

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  7. I disagree that football is good for the economy. Football attracts hundreds of fans to the cities where football games are played. This builds up the economy of that city but also begins to polarize that cities economy. It slowly builds a 'tourist trap' sector around the arena because all businesses want a slice of the economic upturn caused by football. The community begins to pour its resources into attracting as many fans as possible with advertising and bright lights and flashy colors and expenditure. When the football center moves then the economy of that area collapses and all the money the fans put into building it comes to nothing but a ghost town because all or most of the businesses eggs were all in one basket. The home-town of the fans is also impacted negatively. The fans come home with less in there pockets so instead of going out and supporting the local pizzeria or sub joint they eat at home, decreasing there own home's revenue. What you end up getting in football season is an economy full of hills and valleys; hills where the football centers are and valleys everywhere else. They wont level out when football season ends so a slow polarization occurs.

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  8. I think this piece was very great, As a die hard fan I love watching football i spend my money on whatever i can get my hand on. I feel the economy is greatly impacted in a very good way football get people motivated to do things that have to do it gets them going. As a die hard fan I feel as though football brings the economy closer together people meet knew people spend more money at other places with those people and make the economy even better. The economy will get more revenue from the fans because most fans go out spend a lot of money which makes the economy better. Football is a very good thing for the economy.

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  9. I agree with what you said about college football being good for the economy. I have to say though I think the statistic you should be looking at is just the total revenue of the teams. You point out that the most important part of that chart is how much Alabama spends but fail to recognize the large quantities of cash these teams are racking up. Also I agree with what Conner said above about while in the city before the game. Most fans will go to a bar or restaurant either before or after the game. Even if they are tailgating they still buy the food for that! I see what you mean Ashton but I just don't buy it. I do not think there is a solid argument against the benefits of college football to our economy.

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  10. I agree that Football is good for the economy. When a Football game goes on the city that the is hosting the game is making lots of money, not from just the game but from other places like hotels, restaurants, stores selling merchandise. What people don't think about is that football is helping the economy and is entertaining at the same time. Football is a sport that most people enjoy to watch and attend, so when football goes on it benefits everyone

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  11. I never really thought that football could help the economy. I guess I never really put it into thought either. Judging by the statistics and facts given though, I completely agree with this post and understand how the economy is affected. I was surprised that Alabama had the most total expenses on their football program, yet didn't have the most revenue, especially when compared to Texas, who had around $25,000 more in revenue than the Roll Tide. I love football and everything about it, but I would've never thought of it in an economic sense like you displayed. Also, I really liked your examples using opportunity cost, because it's completely true!

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  12. When watching college football I never thought that it was helping the economy that much. I also find it amazing that Boise State is able to bring in that much money when they spend less than Alabama. Another thing that I find fascinating is that college football brings in millions of dollars every year but the players don’t make any money. Even though they get scholarships you would think that they would also get paid.

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  13. I definitely agree with your statement about college football boosting the economy. We Americans don't take our sports lightly. Whether it be alumni or die hard fans, people buy apparel and travel across the country just to support their favorite college. What I found most interesting was the Boise State net income. With Northwestern being a school in the Midwest, it surprised me. Overall I agree that sports are a huge part of our economy and help bring in a lot of money.

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  14. This was very interesting to see how some schools spend more on their football programs and end up making less than the schools spend less and make more. But with some of the schools that spend more on their team might also have a better outcome on the season such as championships. Therefor this was very interesting in seeing how different schools do different things with their team and the outcome of their team ends up differently.

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  15. I thought that your evidence supports your argument--that college football boosts the economy--very well. I thought the first graph in your column was an interesting insight into exactly how much money college football makes, which surprised me. Also the second graph had a breakdown of the revenue and it was interesting to see the difference between where the income comes from for popular teams, especially the difference in money made from tickets and branding.

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  16. Overall I agree with you about college football bringing in a lot of money and helps the economy a lot. I was very shocked to see that Boise State brought in the most mainly because we never really hear much about them other than that they have a blue turf field. I was also very surprised to see that Alabama brings in so much money. I didn't think that they even brought in that much. I agree with you about sports boosting the economy. Without sports our economy would be very different. Good Job!

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  17. I do agree with the view that college football does boost the economy. However I think that due to the fact collegiate football is such a limited time span, it really does not have a complete impact on the economy. While schools like Alabama and Ohio State spend the most money on their college football teams, I really don't believe that their expenses create a significant change in the economy, due to the limited months this sport takes place. However, what I did find very interesting is that Boise State brought in the largest net income when they spend less money than schools like Ohio State, Alabama, or other major schools across the nation. Overall, while I do believe that college football raises the economy during its specific season, I do not really think it has a significant impact on the economy as a whole.

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  18. I agree with your statement about college football. I always love watching the sport, I never thought watching college football would help the economy. I thought it was very interesting that Boise state would bring in so much money. I don’t think many people think about that by just watching and buying merchandise they are helping the economy.

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  19. I believe that college football does not have a big impact on the cities where they are located. By the fact that there is such a small amount of time in which this sport takes place. I don’t believe that the local businesses around the colleges would make enough money to be successful if they simply relied on college football every year for their revenue. Such as hotels there has to be people staying there year round. There is no way that a hotel could stay in business if it mostly relied on college football for their revenue. Most of the businesses are already successful and college football is an asset that they can make more profit off of. However it’s not the lone reason that they are able to stay in business. College football does not have a big impact on the cities in which they are located in.

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