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Fan welfare maximization as a club objective in a professional sports league

  • Madden, Paul
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    Motivated by aspects of European soccer club governance (members' clubs supporters' trusts), a first formal analysis of fan welfare maximization as a club objective in a sports league is provided, with comparisons to objectives studied previously (profit and win maximization). Positive comparisons focus on team qualities, ticket prices, attendances and the impact of capacity crowds; empirically observed ticket black markets and inelastic pricing are consistent only with fan welfare maximization. Normatively, social welfare (aggregate league surplus) is well-served by a league of fan welfare maximizers, or sometimes win maximizers, but not profit maximizers; leagues should not normally make profits.

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    File URL: http://www.sciencedirect.com/science/article/pii/S0014292112000025
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    Article provided by Elsevier in its journal European Economic Review.

    Volume (Year): 56 (2012)
    Issue (Month): 3 ()
    Pages: 560-578

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    Handle: RePEc:eee:eecrev:v:56:y:2012:i:3:p:560-578
    Contact details of provider: Web page: http://www.elsevier.com/locate/eer

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