How are we funding professional sports stadiums? An overview

2016 ◽  
Vol 42 (9) ◽  
pp. 885-890 ◽  
Author(s):  
Abhinav Alakshendra
Keyword(s):  
Federal Government ◽  
State Government ◽  
Public Funding ◽  
Professional Sports ◽  
Content Type ◽  
Public Subsidy ◽  
Sports Stadiums ◽  
Vast Literature ◽  
Sports Leagues ◽  
Almost All

Purpose American taxpayers heavily subsidize professional sports leagues and teams through direct and indirect public funding to build professional sports stadiums. Today, the proportion of public funding to build professional sports stadiums is greater than private contribution. In last 20 years, almost all of the 100 professional stadiums opened have received some form of direct or indirect financial assistance from local, state and federal government. The paper aims to discuss these issues. Design/methodology/approach This paper investigates and documents most often used methods of stadium financing in recent years along with the historical shift from privately built stadiums to public funded stadiums in the span of 65 years. This paper also briefly reviews the literature evaluating the impacts of public spending for professional sports stadiums. The vast literature on the topic reveals that economists and city planners agree that public subsidy to build expensive professional sports stadiums cannot be justified on the grounds of perceived economic development. Findings Over the years, funding mix to build professional sports facilities has changed dramatically. Local government has been coming up with various financing strategies involving new and old instruments. Originality/value The findings also suggest that share of local and state government has gone up in recent years compare to federal government share.

Dynamic pricing usage in sports for revenue management

2016 ◽  
Vol 42 (9) ◽  
pp. 913-921 ◽  
Author(s):  
Adrien Bouchet ◽  
Michael Troilo ◽  
Brian R. Walkup
Keyword(s):  
North American ◽  
Dynamic Pricing ◽  
Professional Sports ◽  
Business Analytics ◽  
Content Type ◽  
Sports Organizations ◽  
Decision Making Processes ◽  
Sports Leagues ◽  
Job Title ◽  
Travel Services

Purpose The purpose of this paper is to examine the extent to which dynamic pricing is utilized in North American professional sports. While industries such as airlines and travel services have employed dynamic pricing for decades, professional sports is only now starting to adopt it. Design/methodology/approach The authors survey and interview high ranking executives and managers in North American sports organizations. A total of 72 managers and executives from the four major North American professional sports leagues as well as other sport properties were surveyed. Descriptive statistics and a basic regression provide insight into perceptions v. actual practice among sports organizations. Findings While most sports organizations perceive high usage of dynamic pricing within their organization, current procedures lag. Nearly 70 percent of respondents believe that their organizations frequently or always apply business analytics to dynamic pricing, but only 30 percent update their prices daily. Fully 50 percent of organizations do not automate decision-making processes, which is a hallmark of dynamic pricing. The perception of constant use of analytics in dynamic pricing intensifies as job title increases. Originality/value As one of the initial surveys looking at the usage of dynamic pricing in North American professional sports, this study provides a glimpse into both the perception and the reality. It suggests that there is still ample room for improvement.

NFL team revenue distribution and revenue sharing: a median voter theorem

2020 ◽  
Vol ahead-of-print (ahead-of-print) ◽  
Author(s):  
Justin Ehrlich ◽  
Shankar Ghimire ◽  
Shane Sanders
Keyword(s):  
Design Methodology ◽  
Median Voter ◽  
National Football League ◽  
Professional Sports ◽  
Revenue Sharing ◽  
Content Type ◽  
Median Voter Theorem ◽  
Sports Leagues ◽  
Average Revenue ◽  
Professional Sports Leagues

PurposeRevenue sharing is ubiquitous among North American professional sports leagues. Under pool revenue sharing, above-average revenue teams of a league effectively transfer revenues to below-average revenue teams. Herein, the authors find and prove that a league will vote into policy a pool revenue sharing arrangement if and only if mean team revenue is greater than presharing median revenue, where this condition is equivalent to the presence of positive nonparametric skewness in a league’s distribution of team revenues. This represents a median voter theorem for league revenue sharing.Design/methodology/approachThe authors consider the case of revenue sharing for the National Football League (NFL), a league that pools and equally shares national revenues among member teams.FindingsThe authors find evidence of positive and significant nonparametric skewness in NFL team revenue distributions for the 2004–2016 seasons. This distribution is observed amid annual majority rule votes of League owners in favor of maintaining the incumbent pool revenue sharing model (as opposed to no team revenue sharing). Distribution of revenues – namely the existence of outlying large market NFL teams – appears to consistently explain the historical popularity of NFL revenue sharing.Originality/valueThe median voter theorem uncovered in the case of NFL applies to all professional sports leagues and can be used predictively as well as descriptively.

The cost of players’ injuries to professional sports leagues and other sports organizations

2020 ◽  
Vol ahead-of-print (ahead-of-print) ◽  
Author(s):  
Bhavneet Walia ◽  
Christopher John Boudreaux
Keyword(s):  
Primary Source ◽  
Professional Sports ◽  
Treatment Costs ◽  
Content Type ◽  
Sports Organizations ◽  
Direct Treatment ◽  
Sports Leagues ◽  
Playing Time ◽  
The Cost ◽  
Professional Sports Leagues

PurposeMost literature studies have focused on direct treatment costs of injuries. This literature is extended to include the foregone playing time of players as an additional injury cost.Design/methodology/approachThe authors have reviewed the literature on the cost of players’ injuries to professional sports leagues and other organizations.FindingsThe authors concluded that players’ injury costs are substantial and sufficiently variable to be a primary source of financial uncertainty for a team.Originality/valueThis study's value has added risk pooling and league-wide revenue sharing as tools to mitigate the risk of injury costs. Previous literature reviews focused predominately on direct treatment costs.

The corporatisation of football and CSR reporting by professional football clubs in Europe

2019 ◽  
Vol 20 (2) ◽  
pp. 242-257
Author(s):  
João Ribeiro ◽  
Manuel Castelo Branco ◽  
João Alves Ribeiro
Keyword(s):  
Design Methodology ◽  
Professional Sports ◽  
European Countries ◽  
Content Type ◽  
Csr Reporting ◽  
Football Clubs ◽  
Sports Leagues ◽  
Corporate Social ◽  
Different Levels ◽  
Professional Sports Leagues

Purpose The purpose of this paper is to examine differences in corporate social responsibility (CSR) reporting on the websites of football clubs based in five European countries with different levels of football corporatisation. Design/methodology/approach The study examines CSR reporting on the internet by football clubs based in five European countries. Multiple regression analysis is used to analyse some factors which influence reporting and test a set of hypotheses. Findings The findings suggest that clubs from countries in which the level of corporatisation is higher disclose more CSR information. Also, clubs with higher public visibility disclose a higher variety of CSR information. Originality/value This study adds to the scarce research on CSR reporting in professional sports leagues by providing new empirical data and by extending prior research comparing such practices within different international frameworks of CSR.

Determinants of audience demand for the televised professional baseball matches in Korea

2019 ◽  
Vol 20 (1) ◽  
pp. 184-202 ◽  
Author(s):  
Yoonji Ryu ◽  
Kihan Kim ◽  
Jong Won Paik ◽  
Yunjae Cheong
Keyword(s):  
Professional Sports ◽  
Third Party ◽  
Professional Baseball ◽  
Related Factors ◽  
Proper Understanding ◽  
Content Type ◽  
Sports Clubs ◽  
Dependent Variables ◽  
Sports Leagues ◽  
Television Ratings

PurposeThe purpose of this paper is to examine factors influencing the audience demand for televised post-season games of the Korean professional baseball league.Design/methodology/approachThe data were collected from a total of 129 games – the entire post-season games from 2008 to 2016. Two dependent variables representing audience demand for televised baseball matches, obtained from the third-party television audit company AGB Nielsen, were regressed on a series of match-related and unrelated antecedent factors associated with each match. Pooled OLS regression with wild bootstrap standard errors with 100,000 replications was applied in the analysis.FindingsRegarding match-related factors, higher television ratings and the greater numbers of television viewers were associated with matches with greater significance, outcome uncertainty and score sum. In terms of the match-unrelated factors, the broadcast platform appeared to be the most powerful predictor of both television ratings and the numbers of viewers. Other than the broadcast platform, night matches, matches with full stadium occupancy and team values showed positive impacts on both the television ratings and the numbers of viewers.Practical implicationsThe sales of media rights and sponsorships are the major sources of revenues for professional sports leagues, and the size of these two streams of revenues is in proportion to the size of the audience demand for television and other media. This study provides valuable insights to the sports marketers of professional sports clubs and leagues by establishing proper understanding of the determinants of the audience demand for televised sports.Originality/valueThe characteristics specific to each professional league and country play unique roles in determining the antecedent factors of audience demand for televised sports; this study is one of the few attempts to examine Koran professional baseball league.

Public Development for Professional Sports Stadiums

2017 ◽  
Author(s):  
Irwin P. Raij ◽  
Alexander Chester
Keyword(s):  
Professional Sports ◽  
Construction Costs ◽  
Role Of Government ◽  
The Public ◽  
Societal Benefits ◽  
Sports Stadiums ◽  
Sports Leagues ◽  
The Government ◽  
Private Matter

This chapter discusses the development and financing for stadiums by the teams in the largest American professional sports leagues, including MLB, the NFL, the NBA, the NHL, and MLS, and the role of government in that process. With the exception of antitrust issues, there may be no aspect of American sports in which the government is as involved as the construction and financing of the stadiums in which the games are played. Stadium development, initially a private matter, entered the public interest because of the dramatic growth in construction costs coupled with the appearance of economic and societal benefits to a region that hosts a major league team. It will come as no surprise that venue projects are challenging and often controversial. This chapter analyzes how teams, leagues, and government entities negotiate for venue development projects, touching on the legal, practical, and political challenges that have emerged over the years.

Confronting the Problems of Professional Sports: A Public Policy Response to Franchise Relocation and Stadium Subsidization

2005 ◽  
Vol 1 ◽  
Author(s):  
Taylor F Brinkman
Keyword(s):  
Local Community ◽  
Professional Sports ◽  
The United States ◽  
Direct Result ◽  
Sports Organizations ◽  
Sports Leagues ◽  
Sports Finance ◽  
Sports Venues ◽  
Benefits And Costs

During the past decade, forty-six professional sports venues were constructed in the United States, while only 16 expansion teams were created by the major sports leagues. Nearly two thirds of these newly built stadiums and arenas were funded with public tax revenues, despite substantial evidence showing no positive economic impact of new sports stadium construction on local communities. In reviewing the economic literature, this article investigates the role of professional sports organizations in the construction and public subsidization of new sports venues. Franchise relocation and public stadium subsidization is a direct result of the monopoly power of professional sports leagues, whose franchise owners extract large subsidies from their host communities by threatening to relocate to viable alternative locations. After explaining how the most common methods of stadium subsidization project a disproportionate allocation of the benefits and costs of hosting a professional team to local community interests, this article outlines several considerations for local policymakers who seek to reinvigorate public discussion of equity concerns in professional sports finance.

Financial Returns in Major League Soccer

2021 ◽  
pp. 152700252110227
Author(s):  
John Charles Bradbury
Keyword(s):  
United States ◽  
Ownership Structure ◽  
North American ◽  
Consumer Demand ◽  
Professional Sports ◽  
The United States ◽  
Professional Soccer ◽  
Major League Soccer ◽  
Major League ◽  
Sports Leagues

Major League Soccer (MLS) is the top-tier professional soccer league serving the United States and Canada. This study examines factors hypothesized to impact consumer demand for professional sports on team revenue in this nascent league. The estimates are consistent with positive returns to performance, novelty effects from newer teams, and varying impacts from roster quality and composition. Other factors hypothesized to be important for MLS teams (e.g., stadium quality and market demographics) are not associated with team revenue. The estimates are similar to findings in other major North American sports leagues, even though MLS operates with a unique single-entity ownership structure that has the potential to disincentivize individual team investments by league owners.

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