Competitive Balance Measures in Sports Leagues: The Effects of Variation in Season Length
AbstractAppropriate measurement of competitive balance is a cornerstone of the economic analysis of professional sports leagues. We examine the distributional properties of the ratio of standard deviations (RSD) of points percentages, the most widely used measure of competitive balance in the sports economics literature, in comparison with other standard-deviation-based measures. Simulation methods are used to evaluate the effects of changes in season length on the distributions of competitive balance measures for different distributions of the strengths of teams in a league. The popular RSD measure performs as expected only in cases of perfect balance; if there is imbalance in team strengths, its distribution is very sensitive to changes in season length. This has important implications for comparisons of competitive balance for different sports leagues with different numbers of teams and/or games played.
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Bibliographic InfoPaper provided by National Centre for Econometric Research in its series NCER Working Paper Series with number 92.
Length: 58 pages
Date of creation: 24 Jul 2013
Date of revision:
Competitive balance; Idealized standard deviation; Ratio of standard; deviations; Season length; Sports economics; Simulation;
Find related papers by JEL classification:
- L83 - Industrial Organization - - Industry Studies: Services - - - Sports; Gambling; Recreation; Tourism
- D63 - Microeconomics - - Welfare Economics - - - Equity, Justice, Inequality, and Other Normative Criteria and Measurement
- C63 - Mathematical and Quantitative Methods - - Mathematical Methods; Programming Models; Mathematical and Simulation Modeling - - - Computational Techniques
This paper has been announced in the following NEP Reports:
- NEP-ALL-2013-09-26 (All new papers)
- NEP-CMP-2013-09-26 (Computational Economics)
- NEP-SPO-2013-09-26 (Sports & Economics)
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