TY  - RPRT
        AU  - Bodvarsson, Örn B.
AU  - Humphreys, Brad R.
        TI  - Labor Market Discrimination and Capital Investment: The Effects of Fan Discrimination on Stadium Investment
        PY  - 2009/Nov/
        PB  - Institute of Labor Economics (IZA)
        CY  - Bonn
        T2  - IZA Discussion Paper
        IS  - 4551
        UR  - https://www.iza.org/index.php/publications/dp4551
        AB  - We investigate the possibility that labor market discrimination affects economic outcomes in the complementary capital market. Previous research contains ample theoretical justification, and empirical evidence, that discrimination affects wages and employment in labor markets. However, the effects of discrimination against minority labor on transactions in markets for other inputs used in production are not known. We develop a model of the optimal capital stock put in place in the presence of customer discrimination and test this model using data on sports facility construction over the period 1950-2004. The empirical evidence suggests that teams in cities with more racial segregation spend less on sports facilities, confirming the predictions of the model about the effect of customer discrimination on capital investment.
        KW  - complementarity
KW  - capital stock
KW  - racial discrimination
KW  - stadium financing
        ER  -