Back to Basics: A New Look at Gate-revenue Sharing and Competitive Balance

Robert Sandy (), Peter James Sloane and John Treble
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John Treble: University of Swansea

No 607, Working Papers from International Association of Sports Economists

Abstract: Most models with profit maximizing teams conclude that competitive balance is unchanged or reduced in response to gate sharing. We critique these models and then develop three alternatives: adding unshared post-season revenue; modelling the largest market team as a dominant firm with a rising marginal cost of talent; and a new general model that incorporates both a consumer demand for athletic talent and close competition. All three approaches can cause gate sharing to increase competitive balance.

Keywords: Sport; Monopsony; Monopoly Power (search for similar items in EconPapers)
JEL-codes: J0 L0 L83 (search for similar items in EconPapers)
New Economics Papers: this item is included in nep-com, nep-mic and nep-spo
Date: 2006-06

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Persistent link: http://EconPapers.repec.org/RePEc:spe:wpaper:0607

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