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Uncertainty of outcome versus reputation: empirical evidence for the First German Football Division

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  • Czarnitzki, Dirk
  • Stadtmann, Georg

Abstract

This paper analyses the determination of match attendance in the German premier football league by applying models derived from Peel/Thomas (1992) and Janssens/Késenne (1987). Additionally we develop an improved version, where we incorporate the supporter clubs and the weather conditions as explanatory variables. While we consider this problem more or less from the consumer perspective, the information gained though this model can also serve as a management tool for football clubs: The returns are directly related to the number of tickets sold. Furthermore, the funds raised by merchandising and advertising are also closely linked to the attendance figures. Due to the limited capacity of the stadiums, some obsevations on attendance are right censored in our sample. While other authors use the ordinary least squares estimator, which produces inconsistent results when events were sold out, we take this restriction implicitly in consideration by using a Tobit model. In conclusion, we show that reputation and goodwill are more important for attendance levels than the thrill of outcome uncertainty.

Suggested Citation

  • Czarnitzki, Dirk & Stadtmann, Georg, 1999. "Uncertainty of outcome versus reputation: empirical evidence for the First German Football Division," ZEW Discussion Papers 99-46, ZEW - Leibniz Centre for European Economic Research.
    • Handle: RePEc:zbw:zewdip:5259
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    References listed on IDEAS

    as
    1. Amemiya, Takeshi, 1973. "Regression Analysis when the Dependent Variable is Truncated Normal," Econometrica, Econometric Society, vol. 41(6), pages 997-1016, November.
    2. Peel, David A & Thomas, Dennis A, 1988. "Outcome Uncertainty and the Demand for Football: An Analysis of Match Attendances in the English Football League," Scottish Journal of Political Economy, Scottish Economic Society, vol. 35(3), pages 242-249, August.
    3. Peel, David A & Thomas, Dennis A, 1992. "The Demand for Football: Some Evidence on Outcome Uncertainty," Empirical Economics, Springer, vol. 17(2), pages 323-331.
    4. repec:bla:econom:v:56:y:1989:i:223:p:323-41 is not listed on IDEAS
    5. Peter J. Sloane, 2000. "The Regulation of Professional Team Sports," IASE Conference Papers 0003, International Association of Sports Economists.
    6. James Tobin, 1956. "Estimation of Relationships for Limited Dependent Variables," Cowles Foundation Discussion Papers 3R, Cowles Foundation for Research in Economics, Yale University.
    Full references (including those not matched with items on IDEAS)

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    More about this item

    Keywords

    Consumer Demand; Team Sports; Tobit Estimator;
    All these keywords.

    JEL classification:

    • D12 - Microeconomics - - Household Behavior - - - Consumer Economics: Empirical Analysis
    • C24 - Mathematical and Quantitative Methods - - Single Equation Models; Single Variables - - - Truncated and Censored Models; Switching Regression Models; Threshold Regression Models

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