nep-spo New Economics Papers
on Sports and Economics
Issue of 2015‒07‒18
two papers chosen by
João Carlos Correia Leitão
Universidade da Beira Interior

  1. Competition among national football leagues. Does it exist ? Should we regulate ? By Yvon Rocaboy
  2. PeersÕ Composition Effects in the Short and in the Long Run: College Major, College Performance and Income By Massimo Anelli; Giovanni Peri

  1. By: Yvon Rocaboy (CREM, UMR CNRS 6211, University of Rennes 1, France)
    Abstract: It is often supposed that the stakeholders of a national football league draw more satisfaction from their sport if the league is balanced. This is the so-called Competitive balance hypothesis. If there exists an international competition like the European champions league, this hypothesis can be challenged however. The utility of national leagues’ stakeholders could be higher, the higher the probability of winning of their representative club at the international level. If it is correct, a league’s governing body intending to maximise the quality of the national league by making use of redistributive schemes would face a tradeoff between national competitive balance and international performance of the national representative club. We propose a simple microeconomic framework to model this tradeoff. If there exists a non-cooperative game among the national league governing bodies, whether it is a Nash or a Stackelberg one, this game would result in inefficient redistributive policies. We find "soft" empirical evidences suggesting that such a competition occurs among the big 5 football leagues in Europe. This result supports the idea of the creation of an international regulatory body. We derive the conditions under which the international regulatory body should ensure that the leagues’ governing bodies implement redistributive schemes guaranteeing the respect of the national competitive balance. We also emphasize the risk of experiencing a drop in the quality of leagues if one of them becomes too big relatively to the others, what we call the tragedy of the wealthy.
    Keywords: Sports economics, National football leagues, International football league, Interleague competition, Competitive balance, Regulation of sports, European football champions league
    JEL: J3 D3 L5 L83
    Date: 2015–07
  2. By: Massimo Anelli; Giovanni Peri
    Abstract: In this paper we use a newly constructed dataset following 30,000 Italian individuals from high school to labor market and we analyze whether the gender composition of peers in high school affected their choice of college major, their academic performance and their labor market income. We leverage the fact that the composition of high school classmates (peers), within school-cohort and teacher-group, was not chosen by the students and it was as good as random. We find that male students graduating from classes with at least 80% of male peers were more likely to choose Òprevalently maleÓ (PM) college majors (Economics, Business and Engineering). However, this higher propensity to enroll in PM majors faded away during college (through transfers and attrition) so that men from classes with at least 80% of male peers in high school did not have higher probability of graduating in PM majors. They had instead worse college performance and did not exhibit any difference in income or labor market outcomes after college. We do not find significant effects on women.
    Keywords: Peer effects, high school, gender, choice of college major, academic performance, wages
    Date: 2015–07

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