Promotion and Relegation in Sporting Contests

Stefan Szymanski and Tommaso Valletti

Rivista di Politica Economica, 2005, vol. 95, issue 3, 3-39

Abstract: The conventional model of a team sports league is based on the North American major leagues which have a fixed number of members, entry is rare and only granted by permission of the incumbents (the closed system). European soccer leagues operate a system of promotion and relegation, effectively permitting entry on merit to all-comers (the open system). This paper examines the impact of openness on the incentive of teams to invest (expend effort) and share resources (redistribution) in the context of a Tullock contest. The main conclusion of the paper is that openness tends to enhance effort incentives, but diminishes the incentive to share income.

JEL-codes: L83 P51 (search for similar items in EconPapers)
Date: 2005
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Citations: View citations in EconPapers (16)

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Chapter: Promotion and Relegation in Sporting Contests (2010)
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Persistent link: https://EconPapers.repec.org/RePEc:rpo:ripoec:v:95:y:2005:i:3:p:3-39

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