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Who made Who? An Empirical Analysis of Competitive Balance in European Soccer Leagues

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Author Info
Leif Brandes
Egon Franck () (Institute for Strategy and Business Economics, University of Zurich, Institute for Strategy and Business Economics, University of Zurich)

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Abstract

There is an on-going debate about the optimal degree of team solidarity in professional European soccer leagues. Support for a high degree of team solidarity has been coming from the theory of competitive balance. Within this theory, attendance has always been referred to as the endogenous variable, stating that diminished uncertainty of outcome will result in a lack of attendance demand. This paper takes a new approach towards the relation between competitive balance and attendance demand. First, we show why this relationship might be reversed. Based on seasonal average match attendance and different measures of competitive balance for several soccer leagues in Europe, this paper then presents results using vector autoregressive models and Granger causality tests. Regarding the analyzed relationship, our results clearly show the existence of heterogeneity across different leagues and for tiers within a league.

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Publisher Info
Paper provided by University of Zurich, Institute for Strategy and Business Economics (ISU) in its series Working Papers with number 0041.

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Length: 24 pages
Date of creation: 2005
Date of revision: 2006
Publication status: Published in: Eastern Economic Journal 2007, Vol. 33, No. 3, pp. 379-403.
Handle: RePEc:iso:wpaper:0041

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Related research
Keywords: competitive balance; sports leagues; Granger Causality; VAR models;

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Find related papers by JEL classification:
C13 - Mathematical and Quantitative Methods - - Econometric and Statistical Methods: General - - - Estimation
C32 - Mathematical and Quantitative Methods - - Multiple or Simultaneous Equation Models; Multiple Variables - - - Time-Series Models; Dynamic Quantile Regressions
L83 - Industrial Organization - - Industry Studies: Services - - - Sports; Gambling; Recreation; Tourism

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References listed on IDEAS
Please report citation or reference errors to , or , if you are the registered author of the cited work, log in to your RePEc Author Service profile, click on "citations" and make appropriate adjustments.:
  1. Stefan Szymanski, 2003. "The Economic Design of Sporting Contests," Journal of Economic Literature, American Economic Association, vol. 41(4), pages 1137-1187, December.
  2. Georg Stadtmann & Dirk Czarnitzki, 2002. "Uncertainty of outcome versus reputation: Empirical evidence for the First German Football Division," Empirical Economics, Springer, vol. 27(1), pages 101-112. [Downloadable!] (restricted)
  3. Davies, B & Downward, P & Jackson, I, 1995. "The Demand for Rugby League: Evidence from Causality Tests," Applied Economics, Taylor and Francis Journals, vol. 27(10), pages 1003-07, October.
  4. Haan, Marco & Koning, Ruud H. & Witteloostuijn, Arjen van, 2002. "Market forces in European soccer," CCSO Working Papers 200211, University of Groningen, CCSO Centre for Economic Research. [Downloadable!]
  5. Jeffery Borland, 2003. "Demand for Sport," Oxford Review of Economic Policy, Oxford University Press, vol. 19(4), pages 478-502, Winter.
  6. Dobson, S M & Goddard, J A, 1992. "The Demand for Standing and Seated Viewing Accommodation in the English Football League," Applied Economics, Taylor and Francis Journals, vol. 24(10), pages 1155-63, October.
  7. El-Hodiri, Mohamed & Quirk, James, 1971. "An Economic Model of a Professional Sports League," Journal of Political Economy, University of Chicago Press, vol. 79(6), pages 1302-19, Nov.-Dec.. [Downloadable!] (restricted)
  8. Rob Simmons & David Forrest & Babatunde Buraimo, 2005. "Freedom of entry, market size and competitive outcome: evidence from English soccer," Working Papers 002495, Lancaster University Management School, Economics Department. [Downloadable!]
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  9. Helmut Dietl & Egon Franck & Patrick, 2003. "Überinvestitionsprobleme in einer Sportliga," Working Papers 0020, University of Zurich, Institute for Strategy and Business Economics (ISU).
  10. Dobson, Stephen M & Goddard, John A, 1998. "Performance and Revenue in Professional League Football: Evidence from Granger Causality Tests," Applied Economics, Taylor and Francis Journals, vol. 30(12), pages 1641-51, December. [Downloadable!] (restricted)
  11. Simmons, Robert, 1996. "The Demand for English League Football: A Club-Level Analysis," Applied Economics, Taylor and Francis Journals, vol. 28(2), pages 139-55, February. [Downloadable!] (restricted)
  12. Haan, Marco & Koning, Ruud H. & Witteloostuijn, Arjen van, 2002. "Market forces in European soccer," Research Report 02F18, University of Groningen, Research Institute SOM (Systems, Organisations and Management). [Downloadable!]
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Cited by:
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  1. Raul Caruso, 2008. "Il calcio tra mercato, relazioni e coercizione," Rivista di Diritto ed Economia dello Sport, Centro di diritto e business dello Sport, vol. 4(1), pages 71-88, Aprile. [Downloadable!]
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