nep-spo New Economics Papers
on Sports and Economics
Issue of 2006‒02‒26
three papers chosen by
Joao Carlos Correia Leitao
Universidade da Beira Interior

  1. Revenue sharing and owner profits in professional team sports By Késenne S.
  2. Competitive balance in team sports and the impact of revenue sharing By Késenne S.
  3. Competitive Balance in European Football: Comparison by adapting measures: National Measure of Seasonal Imbalance and Top 3 By Goossens K.

  1. By: Késenne S.
    Date: 2005–11
  2. By: Késenne S.
    Abstract: In this paper, we present a survey of the main results from economic theory regarding the variables that affect the competitive balance in a professional sports league and the impact of revenue sharing. The generally accepted proposition that revenue sharing does not affect the competitive balance in a profit maximizing league has been challenged by many. It is shown that the competitive balance and the impact of revenue sharing do not only depend on the relative size of the market of the clubs, but that they are also affected by the objectives of the club owners and the importance to spectators of absolute team quality and uncertainty of outcome. Also the clubs' hiring strategies, including the talent supply conditions, turn out to be important elements affecting competitive balance and the impact of revenue sharing.
    Date: 2005–08
  3. By: Goossens K.
    Abstract: Competitive balance is a widely used concept in team sports and often put forward and accepted as a justification of exemptions and interventions. We describe this concept and construct measures in order to compare European national highest league football. We believe that in a unified Europe an international comparison is requisite and precedes the empirical evaluation of theories and implications of policy decisions. We concentrate on two kinds of uncertainty: seasonal imbalance and dominance of teams over seasons and adapt three measures for them. We introduce the National Measure of Seasonal Imbalance (NAMSI): the standard deviation of the winning percentages divided by the standard deviation when there is complete certainty about all outcomes of the games. To include championship dominance we calculate the number of teams that entered the top 3 in a period of 3 years as well as constructing the Lorenz curves for the distribution of championship titles. We compare the highest leagues of 11 European football countries from the season 1963-1964 until 2004-2005 to determine whether there are diverging levels between countries and between measures. We add cluster analysis to show that European competitive balance differs among countries and that depending on the interpretation of the concept other groups exist. We show that the big 5 are not necessarily one group and caution for evaluation of unified interventions is hence appropriate. Ranking of the countries learns that Portugal, the Netherlands and Greece are the least balanced countries independent of the chosen definition and hence measure
    Date: 2005–12

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