IDEAS home Printed from https://ideas.repec.org/a/bla/coecpo/v15y1997i2p114-123.html

Gate Revenue Sharing And Luxury Taxes In Professional Sports

Author

Listed:
  • DANIEL R. MARBURGER

Abstract

This paper examines the impact of gate revenue sharing and luxury taxes on professional sports leagues within the context of a less restrictive demand function than those used in prior models. In contrast to previous studies, the analysis finds that the increased sharing of revenues may enhance competitive balance. Consistent with other models, the analysis finds that player salaries will diminish as the percentage of shared gate receipts rises. The analysis also explores several variations of luxury taxes. All have the effect of lowering salaries. The impact on league balance depends on how the tax is implemented and on how its proceeds are distributed. As with salary caps, enforcement problems exist with the tax.

Suggested Citation

  • Daniel R. Marburger, 1997. "Gate Revenue Sharing And Luxury Taxes In Professional Sports," Contemporary Economic Policy, Western Economic Association International, vol. 15(2), pages 114-123, April.
    • Handle: RePEc:bla:coecpo:v:15:y:1997:i:2:p:114-123
    DOI: 10.1111/j.1465-7287.1997.tb00471.x
    as

    Download full text from publisher

    File URL: https://doi.org/10.1111/j.1465-7287.1997.tb00471.x
    Download Restriction: no
    File URL: https://libkey.io/10.1111/j.1465-7287.1997.tb00471.x?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. Rodney Fort & James Quirk, 1995. "Cross-subsidization, Incentives, and Outcomes in Professional Team Sports Leagues," Journal of Economic Literature, American Economic Association, vol. 33(3), pages 1265-1299, September.
    2. 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 1302-1319, Nov.-Dec..
    3. Simon Rottenberg, 1956. "The Baseball Players' Labor Market," Journal of Political Economy, University of Chicago Press, vol. 64(3), pages 242-242.
    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. Geoffrey N Tuck & Athol R Whitten, 2013. "Lead Us Not into Tanktation: A Simulation Modelling Approach to Gain Insights into Incentives for Sporting Teams to Tank," PLOS ONE, Public Library of Science, vol. 8(11), pages 1-10, November.
    2. Di Domizio Marco, 2008. "Win the best, win the largest or win the richest. Some empirical evidence from Italian championships," wp.comunite 0047, Department of Communication, University of Teramo.
    3. Andrew Larsen & Aju J. Fenn & Erin Leanne Spenner, 2006. "The Impact of Free Agency and the Salary Cap on Competitive Balance in the National Football League," Journal of Sports Economics, , vol. 7(4), pages 374-390, November.
    4. Kelly Goossens, 2006. "Competitive balance in european football: comparison by adapting measures: national measure of seasonal imbalance and Top 3," Rivista di Diritto ed Economia dello Sport, Centro di diritto e business dello Sport, vol. 2(2), pages 77-122, Dicembre.
    5. Carlo Bellavite Pellegrini & Raul Caruso & Marco Di Domizio, 2021. "Relative wages, payroll structure and performance in soccer. Evidence from Italian Serie A (2007-2019)," DISCE - Working Papers del Dipartimento di Politica Economica dipe0015, Università Cattolica del Sacro Cuore, Dipartimenti e Istituti di Scienze Economiche (DISCE).
    6. Brad R. Humphreys & Joshua C. Hall & Hyunwoong Pyun, 2015. "An Inventory of Sports Economics Courses in the US," Working Papers 15-49, Department of Economics, West Virginia University.
    7. Raul Caruso & Francesco Addesa & Marco Di Domizio, 2019. "The Determinants of the TV Demand for Soccer: Empirical Evidence on Italian Serie A for the Period 2008-2015," Journal of Sports Economics, , vol. 20(1), pages 25-49, January.
    8. Yang-Ming Chang & Shane Sanders, 2009. "Pool Revenue Sharing, Team Investments, and Competitive Balance in Professional Sports A Theoretical Analysis," Journal of Sports Economics, , vol. 10(4), pages 409-428, August.
    9. Stefan Kesenne, 2000. "Revenue Sharing and Competitive Balance in Professional Team Sports," Journal of Sports Economics, , vol. 1(1), pages 56-65, February.
    10. Steven Salaga & Alan Ostfield & Jason Winfree, 2014. "Revenue Sharing with Heterogeneous Investments in Sports Leagues: Share Media, Not Stadiums," Review of Industrial Organization, Springer;The Industrial Organization Society, vol. 45(1), pages 1-19, August.
    11. Robert J. Lemke & Matthew Leonard & Kelebogile Tlhokwane, 2010. "Estimating Attendance at Major League Baseball Games for the 2007 Season," Journal of Sports Economics, , vol. 11(3), pages 316-348, June.
    12. Rosen, Sherwin & Sanderson, Allen, 2001. "Labour Markets in Professional Sports," Economic Journal, Royal Economic Society, vol. 111(469), pages 47-68, February.
    13. Roberto Burguet & Jozsef Sakovics, 2016. "To the highest bidder: The market for talent in sports leagues," Edinburgh School of Economics Discussion Paper Series 275, Edinburgh School of Economics, University of Edinburgh.
    14. 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.
    15. Stefan Kesenne, 2007. "Revenue Sharing and Owner Profits in Professional Team Sports," Journal of Sports Economics, , vol. 8(5), pages 519-529, October.
    16. Haan Marco & Koning Ruud & Witteloostuijn Arjen van, 2012. "The Effects of Institutional Change in European Soccer," Journal of Economics and Statistics (Jahrbuecher fuer Nationaloekonomie und Statistik), De Gruyter, vol. 232(3), pages 318-335, June.
    17. Stefan Szymanski, 2004. "Professional Team Sports Are Only a Game," Journal of Sports Economics, , vol. 5(2), pages 111-126, May.
    18. Marco Di Domizio & Carlo Bellavite Pellegrini & Raul Caruso, 2022. "Payroll dispersion and performance in soccer: A seasonal perspective analysis for Italian Serie A (2007–2021)," Contemporary Economic Policy, Western Economic Association International, vol. 40(3), pages 513-525, July.
    19. Wladimir Andreff, 2011. "Some comparative economics of the organization of sports: Competition and regulation in north American vs. European professional team sports leagues," Post-Print halshs-00677436, HAL.
    20. Kevin Mongeon & Jason Winfree, 2012. "Comparison of television and gate demand in the National Basketball Association," Sport Management Review, Taylor & Francis Journals, vol. 15(1), pages 72-79, January.

    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:bla:coecpo:v:15:y:1997:i:2:p:114-123. 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: https://edirc.repec.org/data/weaaaea.html .

    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.