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Market Power in the National Football League

Author

Listed:
  • Stacey L. Brook

    (University of Iowa)

  • Aju J. Fenn

    (Colorado College)

Abstract

Much of the sport economics literature is able to demonstrate that teams have downward-sloping demand curves that imply market power, but there has been no formal test of this hypothesis. This paper provides an initial empirical test of market power for the NFL during the 1995 to 1999 seasons. We employ the price-cost margin methods under constant returns to scale as outlined by Neumann and Haid (1985) and Martin (1988).The two-stage least squares estimates, which control for the endogeneity of the price-cost margin and attendance as a percentage of total capacity, suggest that market power exists for the NFL during the 1995 to 1999 seasons.

Suggested Citation

  • Stacey L. Brook & Aju J. Fenn, 2008. "Market Power in the National Football League," International Journal of Sport Finance, Fitness Information Technology, vol. 3(4), pages 239-244, November.
    • Handle: RePEc:jsf:intjsf:v:3:y:2008:i:4:p:239-244
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    More about this item

    Keywords

    market power; price-cost margin; National Football League;
    All these keywords.

    JEL classification:

    • L83 - Industrial Organization - - Industry Studies: Services - - - Sports; Gambling; Restaurants; Recreation; Tourism

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