An analysis of consumer response to corruption

Babatunde Buraimo (), Giuseppe Migali and Robert Simmons

No 64473209, Working Papers from Lancaster University Management School, Economics Department

Abstract: The literature on economics of corruption is lacking in evidence on consumer responses to identifiable scandals. The Calciopoli episode affecting Italian football in the 2005/06 season serves as an opportunity for an empirical investigation into consumer (fan) behaviour following punishments imposed by the Italian league on clubs whose officials were found guilty of corrupt practices. Using a difference-in-difference estimation method, where the convicted teams are the treatment group, we find that home attendances for treated teams fell by around 16%, relative to control group teams defined as those clubs not subject to league-imposed punishment. We show further that the fall in attendances identified with Calciopoli punishment resulted in non-trivial gate revenue reductions. Our results suggest that a sizeable number of fans of the punished clubs were subsequently deterred from supporting their teams inside the stadium. We explore alternative explanations of this adverse fan response.

Keywords: corruption; consumer demand; Calciopoli; football; attendances (search for similar items in EconPapers)
Date: 2014
New Economics Papers: this item is included in nep-law
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Citations: View citations in EconPapers (5)

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Persistent link: https://EconPapers.repec.org/RePEc:lan:wpaper:64473209

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