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Aggregate Wages Of Players and Performance in Italian Serie A

Author

Listed:
  • Caruso, Raul
  • Di Domizio, Marco
  • Rossignoli, Domenico

Abstract

This paper investigated the relationship between players’ wages and sport performance in the Italian top professional football league - Serie A. The analysis focused on 14 seasons from 2001/2002 to 2014/2015. Findings show that aggregate wage expenditure is a robust predictor of success for Italian professional football teams. We first exploited a fixed-effects panel data and eventually we have addressed the problem of endogeneity by providing a dynamic IV specification of the model. Based on the System-GMM framework, we employed a model including lagged terms of dependent variables and covariates as instruments to control for endogeneity as well as alternative exogenous instruments to control for geographical/environmental factors and for socio-economic factors that could be the actual predictors of performance through an indirect effect on payroll.

Suggested Citation

  • Caruso, Raul & Di Domizio, Marco & Rossignoli, Domenico, 2016. "Aggregate Wages Of Players and Performance in Italian Serie A," MPRA Paper 72720, University Library of Munich, Germany.
    • Handle: RePEc:pra:mprapa:72720
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    More about this item

    Keywords

    Italian serie A; football; soccer; talent; wages; sport performance;

    JEL classification:

    • J40 - Labor and Demographic Economics - - Particular Labor Markets - - - General
    • J49 - Labor and Demographic Economics - - Particular Labor Markets - - - Other
    • L83 - Industrial Organization - - Industry Studies: Services - - - Sports; Gambling; Restaurants; Recreation; Tourism
    • Z19 - Other Special Topics - - Cultural Economics - - - Other

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