Reply: "Professional Team Sports Are Only a Game: The Walrasian Fixed-Supply Conjecture Model, Contest-Nash Equilibrium, and the Invariance Principle"

Stefan Szymanski

Journal of Sports Economics, 2006, vol. 7, issue 2, 240-243

Abstract: Szymanski (2004) explained that at a noncooperative Nash equilibrium for talent choice in a team sports league, revenue sharing will lead to a less-balanced distribution of talent (assuming teams have asymmetric revenue-generating potential). This proposition contradicts the well-known invariance principle. Eckard suggests that these results rest on assumptions about the elasticity of talent supply. This reply explains that this is not the case and that revenue sharing leads to a reduction in competitive balance, whether the supply of talent is elastic or not.

Keywords: contests; revenue sharing; competitive balance (search for similar items in EconPapers)
Date: 2006
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Citations: View citations in EconPapers (19)

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Persistent link: https://EconPapers.repec.org/RePEc:sae:jospec:v:7:y:2006:i:2:p:240-243

DOI: 10.1177/1527002504272948

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