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Regulatory Arbitrage in the Market for Player Rights: Evidence from European Soccer

Author

Listed:
  • Ciliberto, Federico
  • Scotti, Davide
  • Vismara, Silvio

Abstract

Firms facing accounting-based regulation can restructure transactions to meet formal constraints without reducing risk. We study this arbitrage in European soccer, where Financial Fair Play (FFP) rewards inflated capital gains from bilateral player exchanges (“cross-transfers†). Using transaction-level data from 20 European leagues (2015–2023), we identify 412 cross-transfers generating €1.37–€2.94 million in excess capital gains per leg, roughly €0.6–1.2 billion in aggregate. The premium is absent before FFP, and gains are positively correlated within pairs, consistent with coordinated inflation rather than liquidity trading. Arbitrage peaks at 8.5% of reported capital gains, declining after regulators adopted transaction-level scrutiny.

Suggested Citation

  • Ciliberto, Federico & Scotti, Davide & Vismara, Silvio, 2025. "Regulatory Arbitrage in the Market for Player Rights: Evidence from European Soccer," CEPR Discussion Papers 20534, C.E.P.R. Discussion Papers.
    • Handle: RePEc:cpr:ceprdp:20534
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    File URL: https://cepr.org/publications/DP20534
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    More about this item

    JEL classification:

    • G28 - Financial Economics - - Financial Institutions and Services - - - Government Policy and Regulation
    • L51 - Industrial Organization - - Regulation and Industrial Policy - - - Economics of Regulation
    • Z20 - Other Special Topics - - Sports Economics - - - General

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