IDEAS home Printed from https://ideas.repec.org/a/wly/mgtdec/v28y2007i1p57-70.html
   My bibliography  Save this article

Hidden monopsony rents in winner-take-all markets-sport and economic contribution of Spanish soccer players

Author

Listed:
  • Pedro Garcia-del-Barrio

    (Department of Economics, University of Navarra, Edificio Bibliotecas (entrada Este), Pamplona, Spain)

  • Francesc Pujol

    (Department of Economics, University of Navarra, Edificio Bibliotecas (entrada Este), Pamplona, Spain)

Abstract

In labor markets where few companies compete for many workers, economic theory predicts monopsony rents. Surprisingly, soccer clubs do not profit from the expected rents. The purpose of this study is to explain such contradictory evidence. Our model and empirical test, using data obtained from the Spanish professional soccer league for the season 2001|2002, suggests that monopsony rents that the clubs were to obtain from most of the soccer players would eventually revert to the superstars. The study also illustrates that the market value of players stems both from their sporting performance and their economic contribution. Copyright © 2007 John Wiley & Sons, Ltd.

Suggested Citation

  • Pedro Garcia-del-Barrio & Francesc Pujol, 2007. "Hidden monopsony rents in winner-take-all markets-sport and economic contribution of Spanish soccer players," Managerial and Decision Economics, John Wiley & Sons, Ltd., vol. 28(1), pages 57-70.
    • Handle: RePEc:wly:mgtdec:v:28:y:2007:i:1:p:57-70
    DOI: 10.1002/mde.1313
    as

    Download full text from publisher

    File URL: http://hdl.handle.net/10.1002/mde.1313
    File Function: Link to full text; subscription required
    Download Restriction: no
    File URL: https://libkey.io/10.1002/mde.1313?utm_source=ideas
    LibKey link: if access is restricted and if your library uses this service, LibKey will redirect you to where you can use your library subscription to access this item
    ---><---

    References listed on IDEAS

    as
    1. Walter C. Neale, 1964. "The Peculiar Economics of Professional Sports," The Quarterly Journal of Economics, President and Fellows of Harvard College, vol. 78(1), pages 1-14.
    2. Rosen, Sherwin & Sanderson, Allen, 2001. "Labour Markets in Professional Sports," Economic Journal, Royal Economic Society, vol. 111(469), pages 47-68, February.
    3. Stefan Szymanski, 2010. "Income Inequality, Competitive Balance and the Attractiveness of Team Sports: Some Evidence and a Natural Experiment from English Soccer," Palgrave Macmillan Books, in: Football Economics and Policy, chapter 9, pages 182-201, Palgrave Macmillan.
    4. Ira Horowitz & Christopher Zappe, 1998. "Thanks for the memories: baseball veterans' end-of-career salaries," Managerial and Decision Economics, John Wiley & Sons, Ltd., vol. 19(6), pages 377-382.
    5. Scully, Gerald W., 1995. "The Market Structure of Sports," University of Chicago Press Economics Books, University of Chicago Press, edition 1, number 9780226743950, September.
    6. Gerald W. Scully, 2004. "Player salary share and the distribution of player earnings," Managerial and Decision Economics, John Wiley & Sons, Ltd., vol. 25(2), pages 77-86.
    7. Rosen, Sherwin, 1981. "The Economics of Superstars," American Economic Review, American Economic Association, vol. 71(5), pages 845-858, December.
    Full references (including those not matched with items on IDEAS)

    Most related items

    These are the items that most often cite the same works as this one and are cited by the same works as this one.
    1. Allen R. Sanderson & John J. Siegfried, 2003. "Thinking about Competitive Balance," Journal of Sports Economics, , vol. 4(4), pages 255-279, November.
    2. Wladimir Andreff, 2009. "Équilibre compétitif et contrainte budgétaire dans une ligue de sport professionnel," Revue économique, Presses de Sciences-Po, vol. 60(3), pages 591-633.
    3. Helmut Dietl & Tobias Duschl & Markus Lang, 2010. "Gehaltsobergrenzen und Luxussteuern: Erkenntnisse aus dem professionellen Mannschaftssport," Working Papers 0136, University of Zurich, Institute for Strategy and Business Economics (ISU).
    4. Martina Gianecchini & Alberto Alvisi, 2015. "Late career of superstar soccer players: win, play, or gain?," "Marco Fanno" Working Papers 0192, Dipartimento di Scienze Economiche "Marco Fanno".
    5. Pedro Garcia‐del‐Barrio & Francesc Pujol, 2009. "The Rationality of Under‐employing the Best‐performing Soccer Players," LABOUR, CEIS, vol. 23(3), pages 397-419, September.
    6. Dietl Helmut M & Duschl Tobias & Lang Markus, 2011. "Executive Pay Regulation: What Regulators, Shareholders, and Managers Can Learn from Major Sports Leagues," Business and Politics, De Gruyter, vol. 13(2), pages 1-32, August.
    7. Allen R. Sanderson, 2002. "The Many Dimensions of Competitive Balance," Journal of Sports Economics, , vol. 3(2), pages 204-228, May.
    8. Pelnar, Gregory, 2007. "Antitrust Analysis of Sports Leagues," MPRA Paper 5382, University Library of Munich, Germany.
    9. Egon Franck & Stephan Nüesch, 2005. "Talent, Past Consumption and/or Popularity - Are German Soccer Celebrities Rosen or Adler Stars?," Working Papers 0005, University of Zurich, Center for Research in Sports Administration (CRSA), revised 2006.
    10. Roberto Burguet & József Sákovics, 2019. "Bidding For Talent In Sport," Economic Inquiry, Western Economic Association International, vol. 57(1), pages 85-102, January.
    11. Scott M. Kaplan, 2022. "Putting a price on popularity: Evidence from superstars in the National Basketball Association," Economic Inquiry, Western Economic Association International, vol. 60(3), pages 1357-1381, July.
    12. Pedro Garcia-del-Barrio & Francesc Pujol, 2004. "Pay and Performance in the Spanish Soccer League: Who Gets the Expected Monopsony Rents?," Faculty Working Papers 05/04, School of Economics and Business Administration, University of Navarra.
    13. Wladimir Andreff (ed.), 2011. "Contemporary Issues in Sports Economics," Books, Edward Elgar Publishing, number 14146.
    14. Garcia del Barrio, Pedro & Pujol, Francesc, 2016. "Broadcasting revenues and media value in European football," Economics Discussion Papers 2016-36, Kiel Institute for the World Economy (IfW Kiel).
    15. Thieme, Lutz & Falk, Rüdiger, 2021. "Zur Entwicklung von Vergütungssystemen in deutschen Großsportvereinen," Working Papers of the European Institute for Socioeconomics 35, European Institute for Socioeconomics (EIS), Saarbrücken.
    16. Wladimir Andreff & Gaël Raballand, 2011. "Is European Football’s Future to Become a Boring Game?," Chapters, in: Wladimir Andreff (ed.), Contemporary Issues in Sports Economics, chapter 8, Edward Elgar Publishing.
    17. Guido Ascari & Philippe Gagnepain, 2007. "Evaluating Rent Dissipation in the Spanish Football Industry," Journal of Sports Economics, , vol. 8(5), pages 468-490, October.
    18. Thomas Ericson, 2000. "The Bosman Case," Journal of Sports Economics, , vol. 1(3), pages 203-218, August.
    19. Michael Lewis & Yeujun Yoon, 2018. "An Empirical Examination of the Development and Impact of Star Power in Major League Baseball," Journal of Sports Economics, , vol. 19(2), pages 155-187, February.
    20. Bryson, Alex & Chevalier, Arnaud, 2015. "Is there a taste for racial discrimination amongst employers?," Labour Economics, Elsevier, vol. 34(C), pages 51-63.

    More about this item

    Statistics

    Access and download statistics

    Corrections

    All material on this site has been provided by the respective publishers and authors. You can help correct errors and omissions. When requesting a correction, please mention this item's handle: RePEc:wly:mgtdec:v:28:y:2007:i:1:p:57-70. See general information about how to correct material in RePEc.

    If you have authored this item and are not yet registered with RePEc, we encourage you to do it here. This allows to link your profile to this item. It also allows you to accept potential citations to this item that we are uncertain about.

    If CitEc recognized a bibliographic reference but did not link an item in RePEc to it, you can help with this form .

    If you know of missing items citing this one, you can help us creating those links by adding the relevant references in the same way as above, for each refering item. If you are a registered author of this item, you may also want to check the "citations" tab in your RePEc Author Service profile, as there may be some citations waiting for confirmation.

    For technical questions regarding this item, or to correct its authors, title, abstract, bibliographic or download information, contact: Wiley Content Delivery (email available below). General contact details of provider: http://www3.interscience.wiley.com/cgi-bin/jhome/7976 .

    Please note that corrections may take a couple of weeks to filter through the various RePEc services.

    IDEAS is a RePEc service. RePEc uses bibliographic data supplied by the respective publishers.