|
on Sports and Economics |
|
Issue of 2008‒08‒14
eleven papers chosen by Joao Carlos Correia Leitao Technical University of Lisbon |
| By: | Robert Baade (Department of Economics and Business, Lake Forest College); Robert Baumann (Department of Economics, College of the Holy Cross); Victor Matheson (Department of Economics, College of the Holy Cross) |
| Abstract: | College football and men’s basketball are the largest revenue generators in college athletics. Studies funded by athletic boosters tout the economic benefits of a college athletic program as an incentive for host cities to construct new stadiums or arenas at considerable public expense. Our analysis of the economic impact of home football and men’s basketball games on Tallahassee (home of Florida State University) and Gainesville (home of the University of Florida) between 1980 to early-2007 fails to support these claims. Men’s basketball games at these universities have no statistically significant impact on taxable sales, while football yields a modest gain of $2 to $3 million per home game. While this positive finding is one of the first in the academic literature of the impact of sports, these gains pale in comparison to the figures in many of the studies funded by athletic boosters. |
| Keywords: | sports, basketball, football, college sports, impact analysis, mega-event |
| JEL: | L83 O18 R53 |
| Date: | 2007–08 |
| URL: | http://d.repec.org/n?u=RePEc:spe:wpaper:0726&r=spo |
| By: | Harald Oberhofer; Tassilo Philippovich; Hannes Winner |
| Abstract: | This paper assesses the role of distance in professional team sports, taking the example of football (soccer). We argue that a team’s performance in terms of scored and conceded goals decreases with the distance to the foreign playing venue. To test this hypothesis empirically, we investigate 6,389 away games from the German Football Premier League (’Erste Deutsche Bundesliga’) between the playing seasons 1986-87 and 2006-07. We find that distance contributes significantly in explaining a guest team’s propensity to concede goals, but not so for scoring goals. Focusing on the difference between scored and conceded goals (‘goal difference’) as a measure of the overall success of a football team, we observe a significant and non-monotonic impact of distance on team performance. |
| Keywords: | Professional team performance; distance; event count data; poisson regression model |
| JEL: | L25 L83 C29 |
| Date: | 2008–08 |
| URL: | http://d.repec.org/n?u=RePEc:inn:wpaper:2008-16&r=spo |
| By: | Egon Franck (Institute for Strategy and Business Economics, University of Zurich); Stephan NŸesch (Institute for Strategy and Business Economics, University of Zurich) |
| Abstract: | This paper studies the relationship between talent disparity and team productivity based on panel data from German soccer teams. Holding average ability and unobserved team heterogeneity constant, we find evidence that the players selected to play on the competition team should be rather homogeneous regarding their playing talent. If, however, the team is defined at the preparatory stage, which includes all training activities, talent disparity turns out to be beneficial. In a first model, we analyze match-level data to test the talent composition effects of the fielded team on the final score of the game. In a second model, we include the reserve players as well and relate talent differences within the entire squad to the teamÕs (inverted) league standing at the end of the season as the ultimate measure of long-run team effectiveness. At the competition stage of team production, the gameÕs result depends on all team members performing at or above some threshold level of proficiency. At the preparatory stage of team production, however, aspects like mutual learning seem to be more important. |
| Keywords: | Talent Disparity, Team Productivity; Sports Economics, Soccer |
| JEL: | D23 D24 J44 L83 |
| Date: | 2008 |
| URL: | http://d.repec.org/n?u=RePEc:iso:wpaper:0087&r=spo |
| By: | Evan Osborne (Department of Economics, College of the Holy Cross) |
| Abstract: | Rivalries are a key aspect of sports, but one with few counterparts elsewhere in economic theory. In this paper rivalries are modeled as a habitual good, and complementary in fan utility with other trade between residents of team locations. Some implications for optimal team investment in rivalry capital, for league investment in competitive balance, and for the fundamental differences between rivalries in team and individual sports are derived. |
| Keywords: | Rivalry, rivalries, team sports |
| JEL: | L83 L22 |
| Date: | 2008–08 |
| URL: | http://d.repec.org/n?u=RePEc:spe:wpaper:0808&r=spo |
| By: | Dennis Coates (Department of Economics, University of Maryland, Baltimore County); Brad R. Humphreys (Department of Economics, University of Alberta) |
| Abstract: | A growing literature examines the relationship between the on-field success of sports teams and prices of securities traded on stock exchanges. While much of the literature focuses on the effect of national teams on aggregate stock price measures, for example the relationship between the performance of a national team in World Cup competition and the aggregate stock price index in that country, some recent papers have examined the relationship between specific team performance and the price of the shares of the team's owners. We add to this literature by examining the effect of on-field success by baseball teams in Nippon Professional Baseball and the price of the shares of the companies that own these professional baseball teams. |
| JEL: | L83 |
| Date: | 2008–08 |
| URL: | http://d.repec.org/n?u=RePEc:spe:wpaper:0805&r=spo |
| By: | Brad Humphreys (University of Alberta); Jane Ruseski (University of Alberta) |
| Abstract: | We estimate the economic scope of the sports industry in the United States. Drawing on a variety of data sources, we investigate the economic size of sport participation, sports viewing, and the supply and demand side of the sports market in the United States. Estimates of the size of the sports industry based on aggregate demand and aggregate supply range from $44 to $73 billion in 2005. In addition, participation in sports and the opportunity time cost of attending sporting events are important, but hard to value, components of the industry. |
| Keywords: | sports economics |
| JEL: | L83 |
| Date: | 2008–08 |
| URL: | http://d.repec.org/n?u=RePEc:spe:wpaper:0811&r=spo |
| By: | Georgios Kavetsos (Cass Business School, City University, London); Stefan Szymanski (Tanaka Business School, Imperial College) |
| Abstract: | The widely proclaimed economic benefits of hosting major sporting events have received substantial criticism by academic economists and have been shown to be negligible, at best. The aim of this paper is to formally examine the existence of another potential impact: national wellbeing or the so-called “feelgood” factor. Using data on self-reported life satisfaction (happiness) for twelve European countries we test for the impact of hosting and of national athletic success on happiness. Our data covers three different major events: the Olympic Games, the FIFA World Cup and the UEFA European Championship. We find that the “feelgood” factor associated with hosting football events is large and significant, but that the impact of national athletic success on happiness, while correctly signed, is statistically insignificant. |
| Keywords: | Life satisfaction; Happiness; Feel-good factor; Sporting events; Economic impact |
| JEL: | D60 I31 L83 |
| Date: | 2008–08 |
| URL: | http://d.repec.org/n?u=RePEc:spe:wpaper:0804&r=spo |
| By: | Yvan J. Kelly (Department of Economics, College of the Holy Cross) |
| Abstract: | The NBA league office states that the playing schedule is devised to ensure competitive balance while keeping an eye towards minimizing costs. This paper examines those claims. Three years of travel data were analyzed and the results imply that the use of back-to-back road games in the NBA schedule may assist with competitive balance and that back-to-back games indeed reduce team travel costs. |
| Keywords: | basketball, team sports, costs, competitive balance |
| JEL: | L83 |
| Date: | 2008–08 |
| URL: | http://d.repec.org/n?u=RePEc:spe:wpaper:0810&r=spo |
| By: | Robert Baumann (Department of Economics, College of the Holy Cross); Victor Matheson (Department of Economics, College of the Holy Cross); Chihiro Muroi (Department of Economics, College of the Holy Cross) |
| Abstract: | We use daily airplane arrival data from Hawaii’s Department of Business, Economic Development, and Tourism to determine the net change in tourism for a variety of sporting events. We find two events generate a positive and significant net impact on arrivals: Honolulu Marathon and Pro Bowl. We estimate that the Honolulu Marathon produces between 2,183 and 6,519 in net arrivals while the Pro Bowl attracts about 5,595 to 6,725 in net arrivals. At the upper end of our estimates, the Honolulu Marathon and the Pro Bowl attract a nearly identical number of visitors despite the fact that the HTA spends nearly two-thirds of its budget on the rights to the Pro Bowl and spends nothing for the Hawaii Marathon. Neither event attracts the number of net arrivals claimed by its sponsor, and other sporting events do not generate any identifiable impact on tourist arrivals whatsoever. |
| Keywords: | sports, stadiums, impact analysis, mega-event, tourism, marathons, Pro Bowl |
| JEL: | L83 O18 R53 |
| Date: | 2008–08 |
| URL: | http://d.repec.org/n?u=RePEc:spe:wpaper:0807&r=spo |
| By: | Dennis Coates (Department of Economics, University of Maryland, Baltimore County); Babatunde Oguntimein (Department of Economics, University of Maryland, Baltimore County) |
| Abstract: | This paper uses data on players drafted in 1987 through 1989 covering both their collegiate and their professional careers. This time period is chosen because we wanted recent players whose playing days have ended. Our analysis evaluates the role of college productivity on draft position and the relationship between college career productivity, measured in three different ways, with professional career productivity measured similarly and with the length of the career. At issue is the effectiveness of NBA executives in identifying college players who will be successful in the pros. Our results suggest an interesting puzzle regarding scoring. The NBA literature suggests scoring is paramount for evaluating professional players, while our results suggest college scoring has little to do with draft position and is relatively weakly associated with professional scoring. |
| Keywords: | NBA, sports, basketball |
| JEL: | L83 |
| Date: | 2008–07 |
| URL: | http://d.repec.org/n?u=RePEc:spe:wpaper:0806&r=spo |
| By: | Egon Franck (Institute for Strategy and Business Economics, University of Zurich); Erwin Verbeek (Institute for Strategy and Business Economics, University of Zurich); Stephan NŸesch (Institute for Strategy and Business Economics, University of Zurich) |
| Abstract: | This paper investigates sentiment betting both theoretically and empirically. We model the profitable pricing decision of a bookmaker in the presence of both pricesensitive and price-insensitive sentiment bettors who derive extra utility by backing the team they support. Using unique betting volume data from a bet exchange market, we first test the validity of employing home attendance and press coverage as proxies of the amount of sentimental betting. Second, multivariate analysis of a sample of over 32,000 bets on English soccer games shows that bookmakers actively shade prices to attract betting volume evoked by sentiment. Bookmakers offer more favourable odds where fan support is comparably large. The sentiment bias has amplified recently as a reaction to the increased overall price elasticity and the greater share of price-sensitive sentiment bettors in online betting. |
| Keywords: | betting; market efficiency; behavioral bias; soccer |
| JEL: | D11 D12 D21 D81 G14 |
| Date: | 2008 |
| URL: | http://d.repec.org/n?u=RePEc:iso:wpaper:0089&r=spo |