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Make or buy? Human capital accumulation strategies in European club football

Author

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  • Y.E. Akgündüz
  • M.R. van den Berg

Abstract

When it comes to discussing club football emotions tend to get heated quite easily across the globe. This heterogeneity in likes and dislikes is not only reflected in name or financial possibilities, but also in the clubs approach to building a team. We analyze whether clubs' strategies regarding buying or cultivating players have a discernable effect on their success on the pitch. For the analysis we employ match level data covering five seasons of play in top-flight Dutch and English club football leagues. The results suggest that players' tenure has a positive and significant effect on the probability of winning, but only in the English Premier League. The positive effect we find for the Premier League aligns with theories of firm specific human capital. We hypothesize the lack of significant effects in the Dutch league to be tied to clubs' inability to keep successful players with the club or buy replacements of equal quality on the transfer market, because the club-specific human capital component takes time to accumulate.

Suggested Citation

  • Y.E. Akgündüz & M.R. van den Berg, 2013. "Make or buy? Human capital accumulation strategies in European club football," Working Papers 13-17, Utrecht School of Economics.
  • Handle: RePEc:use:tkiwps:1317
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    File URL: https://dspace.library.uu.nl/bitstream/handle/1874/290036/13-17.pdf
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    References listed on IDEAS

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    1. Gary S. Becker, 1962. "Investment in Human Capital: A Theoretical Analysis," Journal of Political Economy, University of Chicago Press, vol. 70, pages 1-9.
    2. Christian Dustmann & Costas Meghir, 2005. "Wages, Experience and Seniority," Review of Economic Studies, Oxford University Press, vol. 72(1), pages 77-108.
    3. Bruinshoofd, Allard & ter Weel, Bas, 2003. "Manager to go? Performance dips reconsidered with evidence from Dutch football," European Journal of Operational Research, Elsevier, vol. 148(2), pages 233-246, July.
    4. Cahuc, Pierre & Postel-Vinay, Fabien, 2002. "Temporary jobs, employment protection and labor market performance," Labour Economics, Elsevier, vol. 9(1), pages 63-91, February.
    5. repec:fth:geneec:00.04 is not listed on IDEAS
    6. Jean-Marc Falter & Christophe Perignon, 2000. "Demand for football and intramatch winning probability: an essay on the glorious uncertainty of sports," Applied Economics, Taylor & Francis Journals, vol. 32(13), pages 1757-1765.
    7. Saumik Paul & Ronita Mitra, 2008. "How predictable are the FIFA worldcup football outcomes? An empirical analysis," Applied Economics Letters, Taylor & Francis Journals, vol. 15(15), pages 1171-1176.
    8. Benno Torgler, 2004. "The Economics of the FIFA Football Worldcup," Kyklos, Wiley Blackwell, vol. 57(2), pages 287-300, May.
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    Keywords

    Football; human capital; tenure; winning probability;

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