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Do Soccer Associations Really Spend on a Good Thing? Empirical Evidence on Heterogeneity in the Consumer Response to Match Uncertainty of Outcome

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Author Info

  • Men-Andri Benz
  • Leif Brandes
  • Egon Franck

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

Abstract

The purpose of this study is to analyze whether previous results describing the effect of uncertainty of outcome on match attendance in team sports have been driven by heterogeneity in fan demand. We apply censored quantile regression methods and place particular emphasis on the relationship between match uncertainty and attendance demand, as previous results are highly ambiguous. This is the more surprising as each season association and league officials continue to spend millions on enhancing this uncertainty. We also control for season ticket holders, who are unlikely to be influenced by match specificities. Based on data from German soccer, our results indicate that fan demand shows heterogeneity across quantiles and that increasing match uncertainty of outcome exclusively benefits teams who already face strong attendance demand.

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Bibliographic Info

Paper provided by University of Zurich, Center for Research in Sports Administration (CRSA) in its series Working Papers with number 0009.

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Length: 35 pages
Date of creation: 2006
Date of revision: 2008
Handle: RePEc:rsd:wpaper:0009

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Related research

Keywords: heterogeneous fan demand; censored quantile regression;

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References

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  1. Baimbridge, Mark & Cameron, Samuel & Dawson, Peter, 1996. "Satellite Television and the Demand for Football: A Whole New Ball Game?," Scottish Journal of Political Economy, Scottish Economic Society, vol. 43(3), pages 317-33, August.
  2. Whitney, James D, 1988. "Winning Games versus Winning Championships: The Economics of Fan Interest and Team Performance," Economic Inquiry, Western Economic Association International, vol. 26(4), pages 703-24, October.
  3. David Peel & Dennis Thomas, 1996. "Attendance demand: an investigation of repeat fixtures," Applied Economics Letters, Taylor & Francis Journals, vol. 3(6), pages 391-394.
  4. B Buraimo & R Simmons, 2006. "Market size and attendance in English Premier League football," Working Papers 574562, Lancaster University Management School, Economics Department.
  5. David Peel & Dennis Thomas, 1997. "Handicaps, outcome uncertainty and attendance demand," Applied Economics Letters, Taylor & Francis Journals, vol. 4(9), pages 567-570.
  6. Michael Hynds & Ian Smith, 1994. "The demand for test match cricket," Applied Economics Letters, Taylor & Francis Journals, vol. 1(7), pages 103-106.
  7. Stefan Szymanski, 2003. "The Economic Design of Sporting Contests," Journal of Economic Literature, American Economic Association, vol. 41(4), pages 1137-1187, December.
  8. Jones, J C H & Ferguson, D G, 1988. "Location and Survival in the National Hockey League," Journal of Industrial Economics, Wiley Blackwell, vol. 36(4), pages 443-57, June.
  9. Daniel, Rascher, 1999. "A Test of the Optimal Positive Production Network Externality in Major League Baseball," MPRA Paper 25832, University Library of Munich, Germany.
  10. Koenker, Roger W & Bassett, Gilbert, Jr, 1978. "Regression Quantiles," Econometrica, Econometric Society, vol. 46(1), pages 33-50, January.
  11. B Buraimo & D Forrest & R Simmons, 2004. "Outcome uncertainty and the couch potato audience," Working Papers 542822, Lancaster University Management School, Economics Department.
  12. Peel, David A & Thomas, Dennis A, 1992. "The Demand for Football: Some Evidence on Outcome Uncertainty," Empirical Economics, Springer, vol. 17(2), pages 323-31.
  13. repec:lan:wpaper:3983 is not listed on IDEAS
  14. repec:lan:wpaper:3698 is not listed on IDEAS
  15. McDonald, Mark & Rascher, Daniel, 2000. "Does Bat Day Make Cents? The Effect of Promotions on the Demand for Major League Baseball," MPRA Paper 25739, University Library of Munich, Germany.
  16. Jeffery Borland, 2003. "Demand for Sport," Oxford Review of Economic Policy, Oxford University Press, vol. 19(4), pages 478-502, Winter.
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Citations

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Cited by:
  1. Lahvicka, Jiri, 2010. "Attendance of ice hockey matches in the Czech Extraliga," MPRA Paper 27653, University Library of Munich, Germany.
  2. Nicholas King & P. Dorian Owen & Rick Audas, 2010. "Playoff Uncertainty, Match Uncertainty and Attendance at Australian National Rugby League Matches," Working Papers 1007, University of Otago, Department of Economics, revised Aug 2010.
  3. Pawlowski, Tim & Budzinski, Oliver, 2014. "Competitive balance and attention level effects: Theoretical considerations and preliminary evidence," Ilmenau Economics Discussion Papers 84, Ilmenau University of Technology, Institute of Economics.
  4. Leif Brandes & Egon Franck & Philipp Theiler, 2010. "The Group Size and Loyalty of Football Fans: A Two-Stage Estimation Procedure to Compare Customer Potential Across Teams," Working Papers 0126, University of Zurich, Institute for Strategy and Business Economics (ISU), revised 2011.
  5. Coates, Dennis & Humphreys, Brad & Zhou, Li, 2012. "Outcome Uncertainty, Reference-Dependent Preferences and Live Game Attendance," Working Papers 2012-7, University of Alberta, Department of Economics.
  6. Dominik Schreyer & Sascha L. Schmidt & Benno Torgler, 2013. "Any Given Sunday: How Season Ticket Holders' Time of Stadium Entrance Is Influenced by Outcome Uncertainty," CREMA Working Paper Series 2013-21, Center for Research in Economics, Management and the Arts (CREMA).
  7. Humphreys, Brad R. & Paul, Rodney J. & Weinbach, Andrew P., 2013. "Consumption benefits and gambling: Evidence from the NCAA basketball betting market," Journal of Economic Psychology, Elsevier, vol. 39(C), pages 376-386.
  8. Lahvicka, Jiri, 2012. "Using Monte Carlo simulation to calculate match importance: the case of English Premier League," MPRA Paper 40998, University Library of Munich, Germany.
  9. Lahvicka, Jiri, 2013. "Does Match Uncertainty Increase Attendance? A Non-Regression Approach," MPRA Paper 48571, University Library of Munich, Germany.

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