Inter-league competition for talent vs. competitive balance
We analyze the distribution of broadcasting revenues by sports leagues. We show that when the teams engage in competitive bidding to attract talent in an isolated league, the league's optimal choice is full revenue sharing (resulting in full competitive balance). In contrast, when the teams of several leagues bid for talent, in equilibrium the leagues choose a performance-based reward scheme. We thus provide an explanation for the differences in revenue sharing rules for national TV rights used by the U.S. sports leagues (full revenue sharing) and European football leagues (performance-based reward).
(This abstract was borrowed from another version of this item.)
If you experience problems downloading a file, check if you have the proper application to view it first. In case of further problems read the IDEAS help page. Note that these files are not on the IDEAS site. Please be patient as the files may be large.
As the access to this document is restricted, you may want to look for a different version under "Related research" (further below) or search for a different version of it.
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.:
- Whitney, James D, 1993. "Bidding Till Bankrupt: Destructive Competition in Professional Team Sports," Economic Inquiry, Western Economic Association International, vol. 31(1), pages 100-115, January.
- Stefan Kesenne, 2000.
"Revenue Sharing and Competitive Balance in Professional Team Sports,"
Journal of Sports Economics,
The North American Association of Sports Economists, vol. 1(1), pages 56-65, February.
- KÉSENNE, Stefan, . "Revenue sharing and competitive balance in professional team sports," Working Papers 1999019, University of Antwerp, Faculty of Applied Economics.
- Scully, Gerald W., 1995. "The Market Structure of Sports," University of Chicago Press Economics Books, University of Chicago Press, edition 1, number 9780226743950, March.
- Palomino, F.A. & Sakovics, J., 2000.
"Revenue Sharing in Professional Sports Leagues : For the Sake of Competitive Balance or as a Result of Monopsony Power?,"
2000-110, Tilburg University, Center for Economic Research.
- Frederic Palomino & Jozsef Sakovics, 2000. "Revenue sharing in professional sports leagues: for the sake of competitive balance or as a result of monopsony power?," ESE Discussion Papers 59, Edinburgh School of Economics, University of Edinburgh.
- Flynn, Michael A & Gilbert, Richard J, 2001. "The Analysis of Professional Sports Leagues as Joint Ventures," Economic Journal, Royal Economic Society, vol. 111(469), pages F27-46, February.
- Philippe Jehiel & Benny Moldovanu, 2000.
"Auctions with Downstream Interaction Among Buyers,"
RAND Journal of Economics,
The RAND Corporation, vol. 31(4), pages 768-791, Winter.
- Rosen, Sherwin, 1981. "The Economics of Superstars," American Economic Review, American Economic Association, vol. 71(5), pages 845-58, December.
- Prat, A. & Rustichini, A., 1999.
"Games Played Through Agents,"
1999-68, Tilburg University, Center for Economic Research.
- Cave, Martin & Crandall, Robert W, 2001. "Sports Rights and the Broadcast Industry," Economic Journal, Royal Economic Society, vol. 111(469), pages F4-26, February.
- Jehiel, Philippe & Moldovanu, Benny & Stacchetti, Ennio, 1996.
"How (Not) to Sell Nuclear Weapons,"
American Economic Review,
American Economic Association, vol. 86(4), pages 814-29, September.
- Robin Naylor & Michele Santoni, 1999.
"Foreign direct investment and wage bargaining,"
CSGR Working papers series
41/99, Centre for the Study of Globalisation and Regionalisation (CSGR), University of Warwick.
- Robin Naylor & Michele Santoni, 2003. "Foreign direct investment and wage bargaining," The Journal of International Trade & Economic Development, Taylor & Francis Journals, vol. 12(1), pages 1-18.
- Scott E. Atkinson & Linda R. Stanley & John Tschirhart, 1988. "Revenue Sharing as an Incentive in an Agency Problem: An example from the National Football League," RAND Journal of Economics, The RAND Corporation, vol. 19(1), pages 27-43, Spring.
- 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.
- Frederic Palomino, 2000. "Competitive Balance vs. Incentives to Win: A Theoretical Analysis of Revenue Sharing," Econometric Society World Congress 2000 Contributed Papers 0930, Econometric Society.
- B. Douglas Bernheim & Michael D. Whinston, 1986. "Menu Auctions, Resource Allocation, and Economic Influence," The Quarterly Journal of Economics, Oxford University Press, vol. 101(1), pages 1-31.
- Thomas Hoehn & Stefan Szymanski, 1999. "The Americanization of European football," Economic Policy, CEPR;CES;MSH, vol. 14(28), pages 203-240, 04.
- 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..
When requesting a correction, please mention this item's handle: RePEc:eee:indorg:v:22:y:2004:i:6:p:783-797. See general information about how to correct material in RePEc.
For technical questions regarding this item, or to correct its authors, title, abstract, bibliographic or download information, contact: (Shamier, Wendy)
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 references are entirely missing, you can add them using this form.
If the full references list an item that is present in RePEc, but the system did not link 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 profile, as there may be some citations waiting for confirmation.
Please note that corrections may take a couple of weeks to filter through the various RePEc services.