nep-spo New Economics Papers
on Sports and Economics
Issue of 2005‒07‒03
three papers chosen by
Joao Carlos Correia Leitao
Universidade da Beira Interior

  1. The Collective Selling of Broadcasting Rights in Team Sports By Tina Heubeck
  2. Selling the Big Game: Estimating the Economic Impact of Mega-Events through Taxable Sales By Victor Matheson; Robert Baade
  3. Contingent Valuation of Sports Stadiums and Arenas: Temporal Embedding and Order Effect By Bruce Johnson; Mike Mondello; John C. Whitehead

  1. By: Tina Heubeck (University of Hamburg, Germany)
    Abstract: This paper introduces the theory of complementarities to the selling of broadcasting rights in team sports in two ways. Firstly, from a legal point of view such rights should not be centrally sold by the league or the association in order to comply with antitrust law because the league as the only seller demands monopoly prices. However, the problem cannot be solved by simply prohibiting collective selling. Using a variation of Cournot's model we show that the price of a single game is higher if sold individually by the participating clubs compared to collective selling by the league. Secondly, as consumers regard games either as complements or as substitutes, demand for simultaneously played games is interdependent. We use the solutions employed in deciding about the pooling of patents to make a general suggestion.
    Keywords: sports, broadcasting rights, complementarities, antitrust law,
    JEL: D23 K21 L43 L13
  2. By: Victor Matheson (Department of Economics, College of the Holy Cross); Robert Baade (Department of Economics and Business, Lake Forest College)
    Abstract: Professional sports leagues, franchises, and civic boosters, have used the promise of an all star game or league championship as an incentive for host cities to construct new stadiums or arenas at considerable public expense. Past league-sponsored studies have estimated that Super Bowls, All-Star games and other sports mega-events increase economic activity by hundreds of millions of dollars in host cities. Our analysis fails to support these claims. Our detailed regression analysis of taxable sales in Florida over the period 1980 to 2004 reveals that on, average, mega-events ranging from the World Cup to the World Series have been associated with reductions in taxable sales in host regions of $5 to $10 million per month. Likewise, strikes in Major League Baseball, the National Hockey League, and the National Basketball League, each of which has resulted in the cancellation of large parts of entire seasons, appear to have also had no demonstrable negative effect on taxable sales in host cities. Length: 31 pages
    Keywords: impact analysis, sports, mega-event, championship
    JEL: L83 R53
    Date: 2005–07
  3. By: Bruce Johnson; Mike Mondello; John C. Whitehead (Appalachian State University)
    Abstract: Using the Contingent Valuation Method, this paper estimates the value of public goods the National Football League’s Jaguars produce for Jacksonville, Florida, including the value of elevating Jacksonville to “major league” status and the value of improving racial relations. It also estimates the incremental value of public goods potentially produced by a National Basketball Association team in Jacksonville. The present value of public goods created by the Jaguars is $36.5 million or less, far below subsidies provided to attract the Jaguars. For a basketball team, the figure is less than $22.8 million. The results add to the growing body of CVM literature indicating that sports public goods probably cannot justify the large public expenditures on stadiums and arenas.
    Date: 2004

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