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Competitive Balance and Attendance in Major League Baseball: An Empirical Test of the Uncertainty of Outcome Hypothesis

Author

Listed:
  • Babatunde Buraimo

    (University of Central Lancashire)

  • Rob Simmons

    () (Lancaster University)

Abstract

After controlling for a number of plausible influences on matchday attendance in the English Premier League, and with appropriate recognition of the censoring problem in stadium capacities, we find clear evidence that an increase in uncertainty of outcome is associated with reduced gate attendance. The conventional uncertainty of outcome hypothesis proposes precisely the opposite effect. We interpret this as suggesting that fans at EPL games, who are predominantly supporters of the home team, prefer to see their team play a much inferior team (and beat that team) rather than attend a game that is predicted to be close in score. Essentially, home fans prefer to see their team win rather than watch a draw or see the home team defeated.

Suggested Citation

  • Babatunde Buraimo & Rob Simmons, 2008. "Competitive Balance and Attendance in Major League Baseball: An Empirical Test of the Uncertainty of Outcome Hypothesis," International Journal of Sport Finance, Fitness Information Technology, vol. 3(3), pages 146-155, August.
  • Handle: RePEc:jsf:intjsf:v:3:y:2008:i:3:p:146-155
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    Cited by:

    1. Helmut M. Dietl & Markus Lang & Stephan Werner, 2010. "The Effect of Luxury Taxes on Competitive Balance, Club Profits, and Social Welfare in Sports Leagues," International Journal of Sport Finance, Fitness Information Technology, vol. 5(1), pages 41-51, February.

    More about this item

    Keywords

    attendance; outcome uncertainty; tobit;

    JEL classification:

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

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