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Indirect Evolution and Aggregate-Taking Behavior in a Football League: Utility Maximization, Profit Maximization, and Success

Aloys L. Prinz ()
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Aloys L. Prinz: Institute of Public Economics, University of Muenster, Wilmergasse 6-8, 48143 Muenster, Germany

Games, 2019, vol. 10, issue 2, 1-12

Abstract: An evolutionary model of European football was applied to analyze a two-stage indirect evolution game in which teams choose their utility function in the first stage, and their optimal talent investments in the second stage. Given the second-stage optimal aggregate-taking strategy (ATS) of talent investment, it was shown that teams may choose a mix of profit or win maximization as their objective, where the former is of considerably higher relevance with linear weights for profits, and is more successful in the utility function. With linear weights for profit and win maximization, maximizing profits is the only evolutionarily stable strategy (ESS) of teams. The results change if quadratic weights for profits and wins are employed. With increasing talent productivity, win maximization dominates in the static and in the dynamic versions of the model. As a consequence, it is an open question whether the commercialization of football (and other sports) leagues will lead to more profit or win maximization.

Keywords: indirect evolution; football leagues; utility maximization; profit maximization; evolutionary stability (search for similar items in EconPapers)
JEL-codes: C C7 C70 C71 C72 C73 (search for similar items in EconPapers)
Date: 2019
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Handle: RePEc:gam:jgames:v:10:y:2019:i:2:p:22-:d:230358