| Abstract: |
In this contribution, we try to investigate, based on a simple theoretical
model, what the optimal number of teams in a league is, taking into account
the most important determinants of club revenue and fans’ utility. The number
of teams fixed by a monopoly league representing the interests of the
participating clubs is clearly smaller than the number of teams in the
competitive free-entry market equilibrium. We have also tested, using European
football data, whether the long-term equilibrium number of teams in the
national top divisions has been determined by the market or by the insiders of
the monopoly leagues. |