IDEAS home Printed from https://ideas.repec.org/a/sae/jospec/v9y2008i5p470-487.html
   My bibliography  Save this article

Population and Bandwagon Effects on Local Team Revenues in Major League Baseball

Author

Listed:
  • Daniel Brown

    (University of Delaware)

  • Charles R. Link

    (University of Delaware, linkc@lerner.udel.edu)

Abstract

Panel models are used to estimate the determinants of local revenues in Major League Baseball. This article updates a previous study by Burger and Walters (2003) with additional data and panel techniques. Consistent with their results, this study finds that market size does matter as a determinant of team marginal revenues when using panel techniques. However, two important differences surface when estimating the bandwagon effect. First, performing well in the postseason is much more important to marginal revenues than having a good regular-season win—loss record. Second, there are spillover effects associated with postseason wins, implying that misspecification arises in models where performance and revenue are only contemporaneously related.

Suggested Citation

  • Daniel Brown & Charles R. Link, 2008. "Population and Bandwagon Effects on Local Team Revenues in Major League Baseball," Journal of Sports Economics, , vol. 9(5), pages 470-487, October.
  • Handle: RePEc:sae:jospec:v:9:y:2008:i:5:p:470-487
    DOI: 10.1177/1527002508315693
    as

    Download full text from publisher

    File URL: https://journals.sagepub.com/doi/10.1177/1527002508315693
    Download Restriction: no

    File URL: https://libkey.io/10.1177/1527002508315693?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. Scully, Gerald W, 1974. "Pay and Performance in Major League Baseball," American Economic Review, American Economic Association, vol. 64(6), pages 915-930, December.
    2. Hausman, Jerry, 2015. "Specification tests in econometrics," Applied Econometrics, Russian Presidential Academy of National Economy and Public Administration (RANEPA), vol. 38(2), pages 112-134.
    3. John D. Burger & Stephen J. K. Walters, 2003. "Market Size, Pay, and Performance," Journal of Sports Economics, , vol. 4(2), pages 108-125, May.
    4. Paul M. Sommers & Noel Quinton, 1982. "Pay and Performance in Major League Baseball: The Case of the First Family of Free Agents," Journal of Human Resources, University of Wisconsin Press, vol. 17(3), pages 426-436.
    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. Scott A. Brave & Kevin A. Roberts, 2019. "The Competitive Effects of Performance-Enhancing Drugs: MLB in the Posttesting Era," Journal of Sports Economics, , vol. 20(6), pages 747-781, August.
    2. Michael Allgrunn & Christopher Douglas & Sebastian Wai, 2024. "Optimal Timeout Choices in Clutch Situations in the NBA," Journal of Sports Economics, , vol. 25(2), pages 217-230, February.
    3. Joshua M. Congdon-Hohman & Jonathan A. Lanning, 2018. "Beyond Moneyball," Journal of Sports Economics, , vol. 19(7), pages 1046-1061, October.
    4. Brian M. Mills & Rodney Fort, 2023. "Performance Quality Preference Heterogeneity in Major League Baseball," Journal of Sports Economics, , vol. 24(3), pages 352-373, April.

    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. John D. Burger & Stephen J. K. Walters, 2008. "The Existence and Persistence of a Winner's Curse: New Evidence from the (Baseball) Field," Southern Economic Journal, John Wiley & Sons, vol. 75(1), pages 232-245, July.
    2. John Charles Bradbury, 2019. "Determinants Of Revenue In Sports Leagues: An Empirical Assessment," Economic Inquiry, Western Economic Association International, vol. 57(1), pages 121-140, January.
    3. David J. Berri & Martin B. Schmidt & Stacey L. Brook, 2004. "Stars at the Gate," Journal of Sports Economics, , vol. 5(1), pages 33-50, February.
    4. Richard Cebula, 2013. "A panel data analysis of the impacts of regional economic factors, marketing and promotions, and team performance on minor league baseball attendance," The Annals of Regional Science, Springer;Western Regional Science Association, vol. 51(3), pages 695-710, December.
    5. Jahn K. Hakes & Chad Turner, 2008. "Long-Term Contracts in Major League Baseball," Working Papers 0831, International Association of Sports Economists;North American Association of Sports Economists.
    6. John Burger & Stephen Walters, 2008. "Testing Fair Wage Theory," Journal of Labor Research, Springer, vol. 29(4), pages 318-332, December.
      • John D. Burger & Stephen J.K. Walters, 2006. "Testing Fair Wage Theory," Working Papers 0623, International Association of Sports Economists;North American Association of Sports Economists.
    7. Torbern Anderson & Sumner J. La Croix, 1989. "Minority Pitchers in Major League Baseball: Is There Discrimination by Fans?," Working Papers 198913, University of Hawaii at Manoa, Department of Economics.
    8. Joshua M. Congdon-Hohman & Jonathan A. Lanning, 2018. "Beyond Moneyball," Journal of Sports Economics, , vol. 19(7), pages 1046-1061, October.
    9. Carlo Bellavite Pellegrini & Raul Caruso & Marco Di Domizio, 2021. "Relative wages, payroll structure and performance in soccer. Evidence from Italian Serie A (2007-2019)," DISCE - Quaderni del Dipartimento di Politica Economica dipe0015, Università Cattolica del Sacro Cuore, Dipartimenti e Istituti di Scienze Economiche (DISCE).
    10. Babatunde Buraimo & David Forrest & Robert Simmons, 2007. "Freedom of Entry, Market Size, and Competitive Outcome: Evidence from English Soccer," Southern Economic Journal, John Wiley & Sons, vol. 74(1), pages 204-213, July.
    11. Jeff Borland, 1987. "The Demand for Australian Rules Football," The Economic Record, The Economic Society of Australia, vol. 63(3), pages 220-230, September.
    12. Joel Maxcy, 2004. "Motivating long-term employment contracts: risk management in major league baseball," Managerial and Decision Economics, John Wiley & Sons, Ltd., vol. 25(2), pages 109-120.
    13. Raul Caruso & Marco Di Domizio & Domenico Rossignoli, 2017. "Aggregate wages of players and performance in Italian Serie A," Economia Politica: Journal of Analytical and Institutional Economics, Springer;Fondazione Edison, vol. 34(3), pages 515-531, December.
    14. Haupert, Michael & Murray, James, 2011. "Regime Switching and Wages in Major League Baseball under the Reserve Clause," MPRA Paper 29094, University Library of Munich, Germany.
    15. Boucher, Michel, 1985. "Coûts de transaction et faible nombre relatif des Canadiens français dans la LNH," L'Actualité Economique, Société Canadienne de Science Economique, vol. 61(3), pages 388-393, septembre.
    16. Marco Di Domizio & Carlo Bellavite Pellegrini & Raul Caruso, 2022. "Payroll dispersion and performance in soccer: A seasonal perspective analysis for Italian Serie A (2007–2021)," Contemporary Economic Policy, Western Economic Association International, vol. 40(3), pages 513-525, July.
    17. Jin Lee & Young Hoon Lee, 2021. "Development of a Win Production Function and Evaluation of Cross-Sectional Dependence," Journal of Sports Economics, , vol. 22(4), pages 412-431, May.
    18. Caruso, Raul & Carlo, Bellavite Pellegrini & Marco, Di Domizio, 2016. "Does diversity in the payroll affect soccer teams’ performance? Evidence from the Italian Serie A," MPRA Paper 75644, University Library of Munich, Germany.
    19. Stephen J. K. Walters & Peter Allmen & Anthony Krautmann, 2017. "Risk Aversion and Wages: Evidence from the Baseball Labor Market," Atlantic Economic Journal, Springer;International Atlantic Economic Society, vol. 45(3), pages 385-397, September.
    20. John Charles Bradbury, 2013. "What Is Right With Scully Estimates of a Player’s Marginal Revenue Product," Journal of Sports Economics, , vol. 14(1), pages 87-96, February.

    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:9:y:2008:i:5:p:470-487. 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.