IDEAS home Printed from https://ideas.repec.org/a/sae/jospec/v4y2003i3p183-202.html
   My bibliography  Save this article

The Stadium Game

Author

Listed:
  • Jeffrey G. Owen

Abstract

The intangible benefits of sports teams are a source of social value that cannot be captured completely by teams through ticket sales and other revenues. A model is developed in which teams attempt to capture social value through stadium subsidies. The number of teams in the league, determined endogenously, increases when subsidies to teams are permitted. The size of the subsidy paid by a city depends on the threat point of teams based on the social value of a team to the largest city without one. Larger cities pay smaller subsidies and may not pay anything. Cartelized leagues substantially increase subsidies by reducing the number of teams, but subsidies are not eliminated in the case of free entry.

Suggested Citation

  • Jeffrey G. Owen, 2003. "The Stadium Game," Journal of Sports Economics, , vol. 4(3), pages 183-202, August.
    • Handle: RePEc:sae:jospec:v:4:y:2003:i:3:p:183-202
    DOI: 10.1177/1527002503251710
    as

    Download full text from publisher

    File URL: https://journals.sagepub.com/doi/10.1177/1527002503251710
    Download Restriction: no
    File URL: https://libkey.io/10.1177/1527002503251710?utm_source=ideas
    LibKey link: if access is restricted and if your library uses this service, LibKey will redirect you to where you can use your library subscription to access this item
    ---><---

    References listed on IDEAS

    as
    1. Scott E. Atkinson & Linda R. Stanley & John Tschirhart, 1988. "Revenue Sharing as an Incentive in an Agency Problem: An example from the National Football League," RAND Journal of Economics, The RAND Corporation, vol. 19(1), pages 27-43, Spring.
    2. Daniel Rascher, 1997. "A model of a professional sports league," International Advances in Economic Research, Springer;International Atlantic Economic Society, vol. 3(3), pages 327-328, August.
    3. Rodney Fort & James Quirk, 1995. "Cross-subsidization, Incentives, and Outcomes in Professional Team Sports Leagues," Journal of Economic Literature, American Economic Association, vol. 33(3), pages 1265-1299, September.
    4. El-Hodiri, Mohamed & Quirk, James, 1971. "An Economic Model of a Professional Sports League," Journal of Political Economy, University of Chicago Press, vol. 79(6), pages 1302-1319, Nov.-Dec..
    5. Baade, Robert A & Dye, Richard F, 1988. "An Analysis of the Economic Rationale for Public Subsidization of Sports Stadiums," The Annals of Regional Science, Springer;Western Regional Science Association, vol. 22(2), pages 37-47, July.
    6. Bruce K. Johnson & Peter A. Groothuis & John C. Whitehead, 2001. "The Value of Public Goods Generated by a Major League Sports Team," Journal of Sports Economics, , vol. 2(1), pages 6-21, February.
    7. Glenn Knowles & Keith Sherony & Mike Haupert, 1992. "The Demand for Major League Baseball: A Test of the Uncertainty of Outcome Hypothesis," The American Economist, Sage Publications, vol. 36(2), pages 72-80, October.
    8. Scully, Gerald W., 1995. "The Market Structure of Sports," University of Chicago Press Economics Books, University of Chicago Press, edition 1, number 9780226743950, December.
    Full references (including those not matched with items on IDEAS)

    Citations

    Citations are extracted by the CitEc Project, subscribe to its RSS feed for this item.
    as


    Cited by:

    1. Sepulveda, Cristian F., 2023. "Cost–Benefit Analysis of an “Average” Professional Sports Team or Stadium in the United States," Journal of Benefit-Cost Analysis, Cambridge University Press, vol. 14(3), pages 451-477, October.
    2. Humphreys, Brad R. & Zhou, Li, 2015. "Reference-dependent preferences, team relocations, and major league expansion," Journal of Economic Behavior & Organization, Elsevier, vol. 109(C), pages 10-25.
    3. Duane W. Rockerbie & Stephen T. Easton, 2019. "Of Bricks and Bats: New Stadiums, Talent Supply, and Team Performance in Major League Baseball," Journal of Sports Economics, , vol. 20(1), pages 3-24, January.
    4. Christopher M. Clapp & Jahn K. Hakes, 2005. "How Long a Honeymoon? The Effect of New Stadiums on Attendance in Major League Baseball," Journal of Sports Economics, , vol. 6(3), pages 237-263, August.

    Most related items

    These are the items that most often cite the same works as this one and are cited by the same works as this one.
    1. Markus LANG & Alexander RATHKE & Marco RUNKEL, 2010. "The Economic Consequences Of Foreigner Rules In National Sports Leagues," Region et Developpement, Region et Developpement, LEAD, Universite du Sud - Toulon Var, vol. 31, pages 47-64.
    2. Stefan Szymanski, 2010. "The Economic Design of Sporting Contests," Palgrave Macmillan Books, in: The Comparative Economics of Sport, chapter 1, pages 1-78, Palgrave Macmillan.
    3. Helmut M. Dietl & Martin Grossmann & Markus Lang, 2011. "Competitive Balance and Revenue Sharing in Sports Leagues With Utility-Maximizing Teams," Journal of Sports Economics, , vol. 12(3), pages 284-308, June.
    4. Stefan Kesenne, 2000. "Revenue Sharing and Competitive Balance in Professional Team Sports," Journal of Sports Economics, , vol. 1(1), pages 56-65, February.
    5. Stephen T. Easton & Duane W. Rockerbie, 2005. "Revenue Sharing, Conjectures, and Scarce Talent in a Sports League Model," Journal of Sports Economics, , vol. 6(4), pages 359-378, November.
    6. Helmut M. Dietl & Markus Lang, 2008. "The Effect Of Gate Revenue Sharing On Social Welfare," Contemporary Economic Policy, Western Economic Association International, vol. 26(3), pages 448-459, July.
    7. Helmut Dietl & Egon Franck & Markus Lang & Alexander Rathke, 2008. "Revenue Sharing, Reserve Clause and Salary Caps in Professional Team Sports Leagues," Working Papers 0026, University of Zurich, Center for Research in Sports Administration (CRSA), revised 2009.
    8. Palomino, F.A. & Sakovics, J., 2000. "Revenue Sharing in Professional Sports Leagues : For the Sake of Competitive Balance or as a Result of Monopsony Power?," Discussion Paper 2000-110, Tilburg University, Center for Economic Research.
    9. Markus Lang & Martin Grossmann & Philipp Theiler, 2011. "The Sugar Daddy Game: How Wealthy Investors Change Competition in Professional Team Sports," Journal of Institutional and Theoretical Economics (JITE), Mohr Siebeck, Tübingen, vol. 167(4), pages 557-577, December.
    10. Joel Maxcy, 2009. "Progressive Revenue Sharing in Major League Baseball: The Effect on Player Transfers and Talent Distribution," Review of Industrial Organization, Springer;The Industrial Organization Society, vol. 35(3), pages 275-297, November.
    11. Helmut Dietl & Egon Franck & Martin Grossmann & Markus Lang, 2009. "Contest Theory and its Applications in Sports," Working Papers 0105, University of Zurich, Institute for Strategy and Business Economics (ISU).
    12. Masaki Fujimoto, 2023. "A Dynamic Analysis of Equal Revenue Sharing and Endogenous Salary Caps in the N-Team Leagues," Journal of Sports Economics, , vol. 24(5), pages 624-638, June.
    13. Joel G. Maxcy, 2006. "Revenue Sharing in MLB: The Effect on Player Transfers," IASE Conference Papers 0634, International Association of Sports Economists.
    14. John R. Crooker & Aju J. Fenn, 2007. "Sports Leagues and Parity When League Parity Generates Fan Enthusiasm," Journal of Sports Economics, , vol. 8(2), pages 139-164, May.
    15. Palomino, Frederic & Sakovics, Jozsef, 2004. "Inter-league competition for talent vs. competitive balance," International Journal of Industrial Organization, Elsevier, vol. 22(6), pages 783-797, June.
    16. Martin Grossmann & Helmut Dietl & Markus Lang, 2010. "Revenue Sharing and Competitive Balance in a Dynamic Contest Model," Review of Industrial Organization, Springer;The Industrial Organization Society, vol. 36(1), pages 17-36, February.
    17. Steven Salaga & Alan Ostfield & Jason Winfree, 2014. "Revenue Sharing with Heterogeneous Investments in Sports Leagues: Share Media, Not Stadiums," Review of Industrial Organization, Springer;The Industrial Organization Society, vol. 45(1), pages 1-19, August.
    18. Robert J. Lemke & Matthew Leonard & Kelebogile Tlhokwane, 2010. "Estimating Attendance at Major League Baseball Games for the 2007 Season," Journal of Sports Economics, , vol. 11(3), pages 316-348, June.
    19. Stefan Szymanski & Stefan Késenne, 2010. "Competitive Balance and Gate Revenue Sharing in Team Sports," Palgrave Macmillan Books, in: The Comparative Economics of Sport, chapter 7, pages 229-243, Palgrave Macmillan.
    20. Helmut M. Dietl & Markus Lang & Stephan Werner, 2009. "Social Welfare in Sports Leagues with Profit‐Maximizing and/or Win‐Maximizing Clubs," Southern Economic Journal, John Wiley & Sons, vol. 76(2), pages 375-396, October.

    More about this item

    Statistics

    Access and download statistics

    Corrections

    All material on this site has been provided by the respective publishers and authors. You can help correct errors and omissions. When requesting a correction, please mention this item's handle: RePEc:sae:jospec:v:4:y:2003:i:3:p:183-202. See general information about how to correct material in RePEc.

    If you have authored this item and are not yet registered with RePEc, we encourage you to do it here. This allows to link your profile to this item. It also allows you to accept potential citations to this item that we are uncertain about.

    If CitEc recognized a bibliographic reference but did not link an item in RePEc to it, you can help with this form .

    If you know of missing items citing this one, you can help us creating those links by adding the relevant references in the same way as above, for each refering item. If you are a registered author of this item, you may also want to check the "citations" tab in your RePEc Author Service profile, as there may be some citations waiting for confirmation.

    For technical questions regarding this item, or to correct its authors, title, abstract, bibliographic or download information, contact: SAGE Publications (email available below). General contact details of provider: .

    Please note that corrections may take a couple of weeks to filter through the various RePEc services.

    IDEAS is a RePEc service. RePEc uses bibliographic data supplied by the respective publishers.