SALARY CAP REGULATION IN PROFESSIONAL TEAM SPORTS.

This paper analyzes the effects of a percentage-of-revenue salary cap in a team sports league with win-maximizing clubs and flexible talent supply. It shows that a percentage-of-revenue cap produces a more balanced league and decreases aggregate salary payments. Taking into account the idiosyncrasie...

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Publicado en:Contemporary Economic Policy Vol. 30; no. 3; pp. 307 - 320
Autores principales: DIETL, HELMUT M., FRANCK, EGON, LANG, MARKUS, RATHKE, ALEXANDER
Formato: Artículo
Publicado: Wiley-Blackwell Jul2012
Materias:
Acceso en línea:Ver este registro en EBSCOhost
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        10.1111/j.1465-7287.2011.00265.x
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        atl: SALARY CAP REGULATION IN PROFESSIONAL TEAM SPORTS.
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        au:
          DIETL, HELMUT M.
          FRANCK, EGON
          LANG, MARKUS
          RATHKE, ALEXANDER
        affil:
          Dietl: Professor, Department of Business Administration, University of Zurich, CH-8032 Zurich, Switzerland. Phone +41 44 634 53 11, Fax +41 44 634 53 01, E-mail
          Franck: Professor, Department of Business Administration, University of Zurich, CH-8032 Zurich, Switzerland. Phone +41 44 634 29 27, Fax +41 44 634 43 48, E-mail
          Lang: Senior Research Associate, Department of Business Administration, University of Zurich, CH-8032 Zurich, Switzerland. Phone +41 44 634 53 11, Fax +41 44 634 53 01, E-mail
          Rathke: Senior Research Associate, Department of Economics, University of Zurich, CH-8032 Zurich, Switzerland. Phone +41 44 634 52 61, Fax +41 44 634 22 91, E-mail
      su:
        Salary caps in sports
        Team sports
        Revenue
        Athletic leagues
        Sports law
        Athletic clubs
        Wage payment systems
        Finance
      sug:
        subj:
          All Other Amusement and Recreation Industries
          Sports Teams and Clubs
          Fitness and Recreational Sports Centers
          Other Similar Organizations (except Business, Professional, Labor, and Political Organizations)
          Salary caps in sports
          Team sports
          Revenue
          Athletic leagues
          Sports law
          Athletic clubs
          Wage payment systems
          Finance
      ab: This paper analyzes the effects of a percentage-of-revenue salary cap in a team sports league with win-maximizing clubs and flexible talent supply. It shows that a percentage-of-revenue cap produces a more balanced league and decreases aggregate salary payments. Taking into account the idiosyncrasies of European football, our paper further highlights the potential conflicts between the league and society. From the perspective of a league governing body, a percentage-of-revenue cap always enhances financial stability of win-maximizing clubs. A social planner, however, will not permit the introduction of such a cap if fans and players unduly suffer. This paper shows under which conditions the social planner accepts (rejects) a salary cap proposed by the league regulator. ( JEL D02, D60, L83)
      pubtype: Academic Journal
      doctype: Article
      src: R
    language: English
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