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Has Financial Fair Play Changed European Football?

Author

Listed:
  • Donato Masciandaro
  • Ariela Caglio
  • Sébastien Laffitte
  • Gianmarco Ottaviano

Abstract

In 2011 UEFA, the governing body of European football, introduced the Financial Fair Play Regulation (FFPR), consisting of a set of financial restraints to be met by clubs as a prerequisite for participation to its competitions. The aim of the FFPR was to introduce financial discipline into the clubs’ decision making processes, and ultimately protect the longterm viability of the European football industry. The reform was criticized because of possible unintended detrimental consequences. In particular, Peeters and Szymanski 2014 provided a model-based ex-ante simulation analysis showing that the reform would increase the profitability of clubs, but also tilt the competitive balance in favor of the top teams, thus reducing the interest of fans and investors as one of the main attractions in sports is precisely that the best team does not always win. Exploiting an original dataset between the seasons 2007-2008 and 2019-2020, we provide an ex-post econometric evaluation of the effects of the introduction of the FFPR revealing causal evidence that largely vindicates those ex-ante predictions.

Suggested Citation

  • Donato Masciandaro & Ariela Caglio & Sébastien Laffitte & Gianmarco Ottaviano, 2022. "Has Financial Fair Play Changed European Football?," BAFFI CAREFIN Working Papers 22189, BAFFI CAREFIN, Centre for Applied Research on International Markets Banking Finance and Regulation, Universita' Bocconi, Milano, Italy.
    • Handle: RePEc:baf:cbafwp:cbafwp22189
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    References listed on IDEAS

    as
    1. Christine Cooper & Joanne Johnston, 2012. "Vulgate accountability: insights from the field of football," Accounting, Auditing & Accountability Journal, Emerald Group Publishing Limited, vol. 25(4), pages 602-634, May.
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    2. Budzinski, Oliver, 2024. "Financial regulation in sport championships as an anticompetitive institution," Ilmenau Economics Discussion Papers 187, Ilmenau University of Technology, Institute of Economics.
    3. Henriques Pereira, Marco & Lang, Markus, 2025. "Transforming talent into performance: Efficiency heterogeneity, strategic behavior, and welfare in sports leagues," Sports Economics Review, Elsevier, vol. 12(C).
    4. Alabi, Mobolaji & Urquhart, Andrew, 2023. "Football finance and Covid-19," Sports Economics Review, Elsevier, vol. 4(C).
    5. Seung Min Shin & Kyunghwa Chung & Changhee Kim, 2024. "The Effects of Homegrown Rule on Efficiency of Sports Teams: Evidence from the English Premier League," Service Science, INFORMS, vol. 16(3), pages 143-154, September.
    6. Budzinski, Oliver & Kunz-Kaltenhäuser, Philipp, 2025. "Decreasing financial imbalances or distorting competition? Examining the effects of the 50plus1-rule in German football," Ilmenau Economics Discussion Papers 197, Ilmenau University of Technology, Institute of Economics.
    7. Simone Pizzi & Francesca Imperiale & Roberta Fasiello, 2025. "Youth players management and financial performance in football industry," MANAGEMENT CONTROL, FrancoAngeli Editore, vol. 2025(1), pages 137-160.
    8. Budzinski, Oliver & Haucap, Justus, 2026. "Fiskalregeln im Profifußball: Was bringt Financial Fair Play?," Ilmenau Economics Discussion Papers 209, Ilmenau University of Technology, Institute of Economics.

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    JEL classification:

    • J30 - Labor and Demographic Economics - - Wages, Compensation, and Labor Costs - - - General

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