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Promotion and Relegation in Sporting Contests

Listed author(s):
  • Stefan Szymanski

    ()

    (Imperial College London)

  • Tommaso M. Valletti

    ()

    (Imperial College London
    CEPR, London)

The conventional model of a team sports league is based on the North American major leagues which have a fixed number of members, entry is rare and only granted by permission of the incumbents (the closed system). European soccer leagues operate a system of promotion and relegation, effectively permitting entry on merit to all-comers (the open system). This paper examines the impact of openness on the incentive of teams to invest (expend effort) and share resources (redistribution) in the context of a Tullock contest. The main conclusion of the paper is that openness tends to enhance effort incentives, but diminishes the incentive to share income.

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File URL: http://www.rivistapoliticaeconomica.it/2005/mag-giu/Szymanski%20ecc_3_40.pdf
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Article provided by SIPI Spa in its journal Rivista di Politica Economica.

Volume (Year): 95 (2005)
Issue (Month): 3 (May-June)
Pages: 3-39

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Handle: RePEc:rpo:ripoec:v:95:y:2005:i:3:p:3-39
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