DETERMINANTS OF REVENUE IN SPORTS LEAGUES: AN EMPIRICAL ASSESSMENT
Document Type
Article
Department
Economics, Finance and Quantitative Analysis
Publication Date
9-11-2018
Abstract
This study investigates determinants of revenue in North America's four major professional sports leagues. Revenue is positively associated with on‐field success in baseball (MLB), basketball (NBA), and hockey (NHL), but not in football (NFL). The returns to success are not diminishing as commonly assumed, which casts doubt on the uncertainty of outcome hypothesis, and differences across leagues are consistent with revenue sharing arrangements. Estimates indicate a strong negative but diminishing relationship between stadium age and revenue. Teams in larger markets generate more revenue than smaller markets, but the returns to success do not differ according to market size.
Journal
Economic Inquiry
Volume
57
Issue
1
First Page
121
Last Page
140
Digital Object Identifier (DOI)
10.1111/ecin.12710