nep-spo New Economics Papers
on Sports and Economics
Issue of 2013‒10‒02
two papers chosen by
Joao Carlos Correia Leitao
University of Beira Interior and Technical University of Lisbon

  1. Financial fair play in European football By Peeters, Thomas; Szymanski, Stefan
  2. International hostility and aggressiveness on the soccer pitch Evidence from European Championships and World Cups for the period 2000-2012 By Caruso, Raul; Di Domizio, Marco

  1. By: Peeters, Thomas; Szymanski, Stefan
    Abstract: In 2010 UEFA, the governing body of European football, announced a set of financial restraints, which clubs must observe when seeking to enter its competitions, notably the UEFA Champions League. We analyze the financial and sporting impact of these “Financial Fair Play” (FFP) regulations in four major European football leagues. We first discuss the details of FFP and frame these regulations in the institutional setup of the European football industry. We then show how the break-even constraint imbedded in FFP could substantially reduce average payrolls and wage-to-turnover ratios, while strengthening the position of the traditional top teams. Since the benefits of the break-even rule to consumers remain unclear, we argue that these rent-shifting regulations might fall foul European competition law.
    Date: 2013–09
  2. By: Caruso, Raul; Di Domizio, Marco
    Abstract: Some Researchers consider soccer matches as the stylization of a war in other battlefields. Such approach was largely used to interpret the violent phenomena related to the soccer environment, while less attention has been paid to the «potential» role of political and economic interactions between countries in determining the aggressive attitude of players on the pitch. In our paper we empirically investigate if and how political hostility among countries reverberates on a soccer pitch by influencing players’ aggressiveness. The analysis focuses on official matches played by national teams in the final phases of the European and World Cup tournaments since 2000. We estimate a Negative Binomial regression including both political and sport variables, and we find that (a) commercial hostility; (b) the level of diplomatic relationships, (c) power asymmetry and (d) education gap between countries are positively and significantly associated with aggressiveness of the players on the pitch, approximated by the number of yellow and red cards. That is, briefly stated, international hostility reverberates into the pitch. Moreover, sport covariates present the expected signs, namely results show that the closeness of the teams, their ranking and the stage of the game (knockout stages with respect to the group phases) are also crucial in determining the cautions.
    Keywords: international hostility, diplomacy, aggressiveness on the pitch, soccer, football.
    JEL: F51 F52 L83
    Date: 2013–03

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