Revenue Sharing, Competitive Balance and the Contest Success Function
This paper investigates revenue sharing in an asymmetric two team contest model of a sports league with Nash behavior of team owners. The innovation of the analysis is that it focuses on the role of the contest success function (CSF). In case of an inelastic talent supply, revenue sharing turns out to worsen competitive balance regardless of the shape of the CSF. For the case of an elastic talent supply, in contrast, the effect of revenue sharing on competitive balance depends on the specification of the CSF. We fully characterize the class of CSFs for which revenue sharing leaves unaltered competitive balance and identify CSFs ensuring that revenue sharing renders the contest closer.
|Date of creation:||Apr 2008|
|Date of revision:|
|Contact details of provider:|| Postal: Universitätsplatz 2, Gebäude W und I, 39106 Magdeburg|
Phone: (0391) 67-18 584
Fax: (0391) 67-12 120
Web page: http://www.ww.uni-magdeburg.de
More information through EDIRC
Please report citation or reference errors to , or , if you are the registered author of the cited work, log in to your RePEc Author Service profile, click on "citations" and make appropriate adjustments.:
- Gu, Yiquan & Wenzel, Tobias, 2009.
"A note on the excess entry theorem in spatial models with elastic demand,"
International Journal of Industrial Organization,
Elsevier, vol. 27(5), pages 567-571, September.
- Gu, Yiquan & Wenzel, Tobias, 2007. "A Note on the Excess Entry Theorem in Spatial Models with Elastic Demand," Ruhr Economic Papers 33, Rheinisch-Westfälisches Institut für Wirtschaftsforschung (RWI), Ruhr-University Bochum, TU Dortmund University, University of Duisburg-Essen.
- Marco Runkel, 2006. "Optimal contest design, closeness and the contest success function," Public Choice, Springer, vol. 129(1), pages 217-231, October.
- Michelle R. Garfinkel & Stergios Skaperdas, 2006.
"Economics of Conflict: An Overview,"
050623, University of California-Irvine, Department of Economics, revised Sep 2006.
- E. Woodrow Eckard, 2006. "Comment: "Professional Team Sports Are Only a Game: The Walrasian Fixed-Supply Conjecture Model, Contest-Nash Equilibrium, and the Invariance Principle"," Journal of Sports Economics, , vol. 7(2), pages 234-239, May.
When requesting a correction, please mention this item's handle: RePEc:mag:wpaper:08012. 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: (Guido Henkel)
If references are entirely missing, you can add them using this form.