| By: |
Helmut Dietl (Institute for Strategy and Business Economics, University of Zurich);
Christian WeingŠrtner (Institute for Strategy and Business Economics, University of Zurich) |
| Abstract: |
Professional football clubs earn most of their revenues from four sources:
sale of broadcasting rights, matchday revenues, merchandising, and
sponsorship. The relative importance of these sources differs among clubs and
leagues. Economists often argue that the ability of professional football
clubs to generate revenues depends to a large extent on their legal structure.
In this paper we analyze the effect of different legal structures, such as
private company, public company, membersÕ association, on sponsorship. Based
on the platform theory we introduce a model of value creation in professional
football. After elaborating the property rights situation for each of the
legal structures we show the direct and indirect effects on the generation of
sponsorship revenues. We theoretically proof the membersÕ association to be
the favorable legal structure with regard to sponsorship. The lack of hold-up
risks for the stakeholders and the strong position of the fans are the major
reasons for the superiority of this non-profit legal structure. |
| Keywords: |
Organization, Sponsorship, Network Effects, Platform, Property Rights |
| Date: |
2011–01 |
| URL: |
https://d.repec.org/n?u=RePEc:iso:wpaper:0141 |