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Firm Survival in Professional Sports: Evidence from the German Football League

Author

Listed:
  • Oberhofer, Harald

    () (University of Salzburg)

  • Philippovich, Tassilo

    () (Department of Economics and Statistics, University of Innsbruck)

  • Winner, Hannes

    () (University of Salzburg)

Abstract

This paper investigates firm survival in professional football, arguing that the relegation and promotion system in football leagues is very similar to firm exits and entries in traditional goods and service markets. Empirically, we use a dataset containing information on how long football teams have remained in the German Premier League over the playing seasons 1981-82 to 2009-10. Controlling for club and market specific characteristics, such as a team's budget or its player composition, our findings suggest that younger firms are systematically exposed to higher risks of market exit in professional football, which is often referred to as `liability of newness' in industrial organization.

Suggested Citation

  • Oberhofer, Harald & Philippovich, Tassilo & Winner, Hannes, 2010. "Firm Survival in Professional Sports: Evidence from the German Football League," Working Papers in Economics 2010-16, University of Salzburg, revised 27 Aug 2011.
    • Handle: RePEc:ris:sbgwpe:2010_016
    as

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    References listed on IDEAS

    as
    1. Carlos Pestana Barros & Bernd Frick & Jose Passos, 2009. "Coaching for survival: the hazards of head coach careers in the German 'Bundesliga'," Applied Economics, Taylor & Francis Journals, vol. 41(25), pages 3303-3311.
    2. Miguel Manjón-Antolín & Josep-Maria Arauzo-Carod, 2008. "Firm survival: methods and evidence," Empirica, Springer;Austrian Institute for Economic Research;Austrian Economic Association, vol. 35(1), pages 1-24, March.
    3. Silviano Esteve-Pérez & Juan Mañez-Castillejo, 2008. "The Resource-Based Theory of the Firm and Firm Survival," Small Business Economics, Springer, vol. 30(3), pages 231-249, March.
    4. Silviano Pérez & Amparo Llopis & Juan Llopis, 2004. "The Determinants of Survival of Spanish Manufacturing Firms," Review of Industrial Organization, Springer;The Industrial Organization Society, vol. 25(3), pages 251-273, August.
    Full references (including those not matched with items on IDEAS)

    More about this item

    Keywords

    Firm survival; liability of newness; duration analysis; sports leagues; relegation;

    JEL classification:

    • C25 - Mathematical and Quantitative Methods - - Single Equation Models; Single Variables - - - Discrete Regression and Qualitative Choice Models; Discrete Regressors; Proportions; Probabilities
    • C41 - Mathematical and Quantitative Methods - - Econometric and Statistical Methods: Special Topics - - - Duration Analysis; Optimal Timing Strategies
    • L21 - Industrial Organization - - Firm Objectives, Organization, and Behavior - - - Business Objectives of the Firm
    • L25 - Industrial Organization - - Firm Objectives, Organization, and Behavior - - - Firm Performance
    • L83 - Industrial Organization - - Industry Studies: Services - - - Sports; Gambling; Restaurants; Recreation; Tourism

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