IDEAS home Printed from https://ideas.repec.org/a/jsf/intjsf/v1y2006i4p227-238.html
   My bibliography  Save this article

Addressing the Small Market Problem for Canadian NHL Franchises: On-site Gaming as a New Revenue Stream

Author

Listed:
  • Daniel S. Mason

    () (University of Alberta)

Abstract

This paper identifies the unique problems faced by Canadian small market (CSM) franchises in the National Hockey League (NHL). While featuring characteristics similar to other major leagues in North America, CSM franchises are also burdened by currency and taxation issues that favor US-based teams, as well as a reliance on gate revenues, which have exacerbated the problem for NHL teams. Three general alternatives devised to address the small market problem are introduced in this paper: (1) allow other stakeholders, such as levels of government, to subsidize weaker teams; (2) create revenue sharing agreements among teams to distribute money to weaker franchises; and (3) create artificial restraints on player salaries in order to reduce the ability of large market teams to stockpile talent (Cocco & Jones, 1997). These are reviewed in the context of the NHL and include the Mills Report and Manley proposals, the Alberta Players Tax, lotteries, revenue sharing, and salary caps. A proposal is put forward to explore the use of on-site gaming in arenas in order to provide additional revenues for Canadian-based NHL teams. The benefits of such a proposal are then reviewed, which include: (1) acting as a less regressive tax than other government subsidies by targeting game attendees; (2) having fans who already support the team provide the subsidization, eliminating those who are not followers of hockey from bearing the financial burden; and (3) enhancing the viewing experience of fans. In doing so, it is hoped that an alternative way of assisting small market Canadian teams can be achieved that does not require substantial legal or labor negotiations, while not altering the structural characteristics of the league as a whole.

Suggested Citation

  • Daniel S. Mason, 2006. "Addressing the Small Market Problem for Canadian NHL Franchises: On-site Gaming as a New Revenue Stream," International Journal of Sport Finance, Fitness Information Technology, vol. 1(4), pages 227-238, November.
  • Handle: RePEc:jsf:intjsf:v:1:y:2006:i:4:p:227-238
    as

    Download full text from publisher

    File URL: http://www.fitinfotech.com/IJSF/backissueresults.tpl?ISSID=1%3A4&Available=T&startat=1
    Download Restriction: Full-text download requires subscription from FIT.

    As the access to this document is restricted, you may want to search for a different version of it.

    More about this item

    Keywords

    hockey; gaming; arena; government subsidies; Canada;

    JEL classification:

    • L83 - Industrial Organization - - Industry Studies: Services - - - Sports; Gambling; Restaurants; Recreation; Tourism

    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:jsf:intjsf:v:1:y:2006:i:4:p:227-238. 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: (Victor Matheson). General contact details of provider: http://www.fitinfotech.com/ .

    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.

    We have no references for this item. You can help adding them by using 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.

    Please note that corrections may take a couple of weeks to filter through the various RePEc services.

    IDEAS is a RePEc service hosted by the Research Division of the Federal Reserve Bank of St. Louis . RePEc uses bibliographic data supplied by the respective publishers.