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Revenue Sharing and Competitive Balance in Professional Team Sports

Author

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  • Stefan Kesenne

    (UFSIA, University of Antwerp)

Abstract
The aim of this article is to clarify the apparent confusion in the literature about the impact of a revenue sharing arrangement on the competitive balance in a sports league. A crucial factor in the discussion seems to be the impact of the absolute rather than the relative quality of the teams on the clubs' revenues. The analysis shows that revenue sharing improves the competitive balance under both the profit- and the utility-maximizing hypotheses.

Suggested Citation

  • Stefan Kesenne, 2000. "Revenue Sharing and Competitive Balance in Professional Team Sports," Journal of Sports Economics, , vol. 1(1), pages 56-65, February.
    • Handle: RePEc:sae:jospec:v:1:y:2000:i:1:p:56-65
    DOI: 10.1177/152700250000100105
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    References listed on IDEAS

    as
    1. Scott E. Atkinson & Linda R. Stanley & John Tschirhart, 1988. "Revenue Sharing as an Incentive in an Agency Problem: An example from the National Football League," RAND Journal of Economics, The RAND Corporation, vol. 19(1), pages 27-43, Spring.
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    5. Daniel R. Marburger, 1997. "Gate Revenue Sharing And Luxury Taxes In Professional Sports," Contemporary Economic Policy, Western Economic Association International, vol. 15(2), pages 114-123, April.
    6. Rodney Fort & James Quirk, 1995. "Cross-subsidization, Incentives, and Outcomes in Professional Team Sports Leagues," Journal of Economic Literature, American Economic Association, vol. 33(3), pages 1265-1299, September.
    7. 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..
    8. Stefan Szymanski & Ron Smith, 2010. "The English Football Industry: Profit, Performance and Industrial Structure," Palgrave Macmillan Books, in: Football Economics and Policy, chapter 1, pages 1-26, Palgrave Macmillan.
    9. Sloane, Peter J, 1971. "The Economics of Professional Football: The Football Club as a Utility Maximiser," Scottish Journal of Political Economy, Scottish Economic Society, vol. 18(2), pages 121-146, June.
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