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The Bottom Line: Accounting for Revenues and Expenditures in Intercollegiate Athletics

Author

Listed:
  • Victor A. Matheson

    (Department of Economics, College of the Holy Cross)

  • Debra J. O’Connor

    (Department of Economics, College of the Holy Cross)

  • Joseph H. Herberger

    (Department of Economics, College of the Holy Cross)

Abstract

This paper examines the profitability of Division I athletic programs at colleges and universities in the United States under a variety of accounting definitions of profit. The data identify several broad themes. First, a majority of athletic departments rely heavily on direct and indirect subsidization of their programs by the student body, the institution itself, and state governments in order to balance their books. Without such funding, less than a third of BCS athletic departments and no non-BCS departments are in the black. Second, athletic programs rely heavily on contributions to balance their books. Donations to athletic departments may serve as a substitute for donations to the rest of the university, lowering giving to other programs. Third, football and men’s basketball programs are generally highly profitable at BCS schools, but below this top tier, fewer than 10% of football programs and 15% of men’s basketball programs show a profit by any reasonable accounting measures.

Suggested Citation

  • Victor A. Matheson & Debra J. O’Connor & Joseph H. Herberger, 2011. "The Bottom Line: Accounting for Revenues and Expenditures in Intercollegiate Athletics," Working Papers 1101, College of the Holy Cross, Department of Economics.
    • Handle: RePEc:hcx:wpaper:1101
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    File URL: https://hcapps.holycross.edu/hcs/RePEc/hcx/HC1101-Matheson-OConnor_CollegeAccounting.pdf
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    Cited by:

    1. Mulholland, Sean E. & Tomic, Aleksandar (Sasha) & Sholander, Samuel N., 2014. "The faculty Flutie factor: Does football performance affect a university's US News and World Report peer assessment score?," Economics of Education Review, Elsevier, vol. 43(C), pages 79-90.

    More about this item

    Keywords

    Athletics; higher education; sports;
    All these keywords.

    JEL classification:

    • L83 - Industrial Organization - - Industry Studies: Services - - - Sports; Gambling; Restaurants; Recreation; Tourism
    • O18 - Economic Development, Innovation, Technological Change, and Growth - - Economic Development - - - Urban, Rural, Regional, and Transportation Analysis; Housing; Infrastructure
    • R53 - Urban, Rural, Regional, Real Estate, and Transportation Economics - - Regional Government Analysis - - - Public Facility Location Analysis; Public Investment and Capital Stock
    • J23 - Labor and Demographic Economics - - Demand and Supply of Labor - - - Labor Demand

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