TV Revenue Sharing as a Coordination Device in Sports Leagues
As sports clubs jointly produce contests, they cannot determine contest quality through their private talent investments. Sports leagues therefore try to coordinate talent investments towards the profit-maximizing contest quality. In this paper I analyze how revenue sharing mechanisms may serve this goal when demand comes from hard-core club and neutral sports fans. Performance-based sharing turns out to be an inefficient sharing rule for the cartel, although it is not harmful for social welfare. This inefficient cartel behavior can be rationalized as the result of bargaining with asymmetric outside options. Data from US and European sports leagues illustrate the theoretical findings.
|Date of creation:||Mar 2011|
|Contact details of provider:|| Web page: http://www.cdes.fr/index.php?id=fr69|
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.:
- Thomas Peeters, 2011.
"Broadcast Rights and Competitive Balance in European Soccer,"
International Journal of Sport Finance,
Fitness Information Technology, vol. 6(1), pages 23-39, February.
- PEETERS, Thomas, 2009. "Broadcasting rights and competitive balance in European soccer," Working Papers 2009009, University of Antwerp, Faculty of Applied Economics.
- Simon Rottenberg, 1956. "The Baseball Players' Labor Market," Journal of Political Economy, University of Chicago Press, vol. 64, pages 242-242.
- Sonia Falconieri & Frédéric Palomino & József Sákovics, 2004. "Collective Versus Individual Sale of Television Rights in League Sports," Journal of the European Economic Association, MIT Press, vol. 2(5), pages 833-862, September.
- Lars-Hendrik Röller & Frode Steen, 2006. "On the Workings of a Cartel: Evidence from the Norwegian Cement Industry," American Economic Review, American Economic Association, vol. 96(1), pages 321-338, March.
- Stefan Szymanski & Stefan KÈsenne, 2004. "Competitive balance and gate revenue sharing in team sports," Journal of Industrial Economics, Wiley Blackwell, vol. 52(1), pages 165-177, 03.
- SZYMANSKI, Stefan & KÉSENNE, Stefan, 2003. "Competitive balance and gate revenue sharing in team sports," Working Papers 2003003, University of Antwerp, Faculty of Applied Economics.
- Lawrence M. Kahn, 2007. "Markets: Cartel Behavior and Amateurism in College Sports," Journal of Economic Perspectives, American Economic Association, vol. 21(1), pages 209-226, Winter.
- Palomino, Frederic & Sakovics, Jozsef, 2004. "Inter-league competition for talent vs. competitive balance," International Journal of Industrial Organization, Elsevier, vol. 22(6), pages 783-797, June.
- Frederic Palomino & Jozsef Sakovics, 2003. "Inter-league competition for talent vs. competitive balance," ESE Discussion Papers 96, Edinburgh School of Economics, University of Edinburgh.
- Stefan Kesenne, 2000. "Revenue Sharing and Competitive Balance in Professional Team Sports," Journal of Sports Economics, , vol. 1(1), pages 56-65, February.
- Szymanski, Stefan, 2001. "Income Inequality, Competitive Balance and the Attractiveness of Team Sports: Some Evidence and a Natural Experiment from English Soccer," Economic Journal, Royal Economic Society, vol. 111(469), pages 69-84, February.
- David Forrest & Rob Simmons & Stefan Szymanski, 2004. "Broadcasting, Attendance and the Inefficiency of Cartels," Review of Industrial Organization, Springer;The Industrial Organization Society, vol. 24(3), pages 243-265, May.
- David Forrest & Robert Simmons & Babatunde Buraimo, 2005. "Outcome Uncertainty And The Couch Potato Audience," Scottish Journal of Political Economy, Scottish Economic Society, vol. 52(4), pages 641-661, September.
- B Buraimo & D Forrest & R Simmons, 2004. "Outcome uncertainty and the couch potato audience," Working Papers 542822, Lancaster University Management School, Economics Department.
- El-Hodiri, Mohamed & Quirk, James, 1971. "An Economic Model of a Professional Sports League," Journal of Political Economy, University of Chicago Press, vol. 79(6), pages 1302-1319, Nov.-Dec..
- Donald G. Ferguson & J. C. H. Jones & Kenneth G. Stewart, 2000. "Competition Within A Cartel: League Conduct And Team Conduct In The Market For Baseball Player Services," The Review of Economics and Statistics, MIT Press, vol. 82(3), pages 422-430, August. Full references (including those not matched with items on IDEAS)