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The Economic Consequences Of Foreigner Rules In National Sports Leagues

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  • Markus LANG

    ()
    (Institute of Strategy and Business Economics, University of Zurich)

  • Alexander RATHKE

    ()
    (Institute for Empirical Research in Economics, University of Zurich)

  • Marco RUNKEL

    ()
    (Faculty of Economics and Management, University of Magdeburg)

Abstract

Profitable and balanced domestic league sports are among the central prerequisites for attracting the right to host a mega-event like the soccer world cup as well as for the overall economic success of such events. This paper provides a contest model of a professional team sports league and analyzes the impact of a restriction on foreign players. It shows that a league with binding restrictions on foreign talent for all clubs is more balanced than a league without binding restrictions on foreign talent. Moreover, the wage level of domestic (foreign) talent is higher (lower) in a league with a binding restriction on foreign players. Finally, a tighter restriction on foreign players increases profits of all clubs.

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Bibliographic Info

Article provided by Region et Developpement, LEAD, Universite du Sud - Toulon Var in its journal Région et Développement.

Volume (Year): 31 (2010)
Issue (Month): ()
Pages: 47-64

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Handle: RePEc:tou:journl:v:31:y:2010:p:47-64

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Keywords: TEAM SPORTS LEAGUES; COMPETITIVE BALANCE; PLAYER SALARIES;

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Blog mentions

As found by EconAcademics.org, the blog aggregator for Economics research:
  1. Limiting Foreigners in Sports Leagues
    by jamesreade in International Journal of Sport Finance Blog on 2009-08-20 17:35:45
  2. Limit foreigners in sports leagues
    by Economic Logician in Economic Logic on 2009-08-17 14:49:00
  3. 6+5: the economics
    by chris dillow in Stumbling and Mumbling on 2009-05-05 13:57:45
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Cited by:
  1. Helmut Dietl & Egon Franck & Markus Lang & Alexander Rathke, 2010. "Organizational Differences between U.S. Major Leagues and European Leagues: Implications for Salary Caps," Working Papers 0035, University of Zurich, Center for Research in Sports Administration (CRSA).

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