John R. Crooker

The Demand for NFL Attendance: A Rational Addiction Model

This paper examines the demand for attendance at National Football League (NFL) games using a rational addiction model to test the hypothesis that professional football displays the properties of a habit-forming good. Rational addiction theory suggests that past and future consumption play a part in determining the current periods consumption for habit-forming goods. A pooled data set is collected using statistics from each NFL team from the 1983 to the 2002 seasons. Current attendance is modeled as a function of team specific variables including past and future attendance, ticket price, and team performance as well as league variables such as the incidence of strikes. The model is estimated using Two-Stage Least Squares (2SLS). It is found that past and future attendance, winning percentage, the age of the stadium in which a team plays, and the occurrence of strikes are significant factors in the determination of attendance at NFL games. The fact that coefficients for past and future attendance are positive and significant in this analysis lends support to the notion that NFL fans display characteristics of rational addiction in their consumption behavior.

Sports Leagues and Parity When League Parity Generates Fan Enthusiasm

This article demonstrates theoretically that, given a casual relationship exists from league parity to fan interest, as large-market teams myopically outbid small-market teams for talent there is potential for league parity to be underprovided. In this model, league parity is treated as a public good. With this characterization, this article arrives at the familiar economic result that public goods tend to be underprovided. This article does not discuss the impact of declining league parity intertemporally. Intuition suggests this decline could hamper interest in the league sport and even lead to a smaller fan base. The results suggest that if league parity is an important determinant of fan interest, a league lump-sum payment (transfer) and tax (subsidy) system may result in higher league profits. The article does add as a caveat that the authors are in no way justifying the revenue sharing plan adopted by Major League Baseball or any other league.

Valuing human organs: an application of contingent valuation

Purpose - This paper aims to estimate a supply response to monetary incentives to donate organs using a survey based on Adams, Barnett and Kaserman. Design/methodology/approach - The paper uses bootstrap techniques to estimate the characteristics of individuals and their willingness to accept monetary compensation for an organ donation commitment. It uses the estimates to fuel a simulation that examines the relationship between a market-clearing price and the usability rate. The usability rate is the proportion of deaths that result in tissues that are viable for transplant. Findings - By analyzing the relationship between usability rate and market-clearing price, the paper identifies three important ranges. When the usability rate is about 5 percent, a donation-only system (zero price) should clear the market. At a usability rate between 2 and 5 percent, modest monetary incentives can attract a supply response that will clear the market. When the usability rate is less than 2 percent, supply becomes sufficiently inelastic so that even large monetary incentives will not solve the shortage problem. Practical implications - If the market mechanism were capable of yielding a greater number of organs for transplantation than the current system, then its adoption would save numerous lives and significantly reduce the cost of treating a variety of serious diseases. Also, it is useful in a benefit-cost analysis framework designed to measure the social value of refinements in the coordination system. Originality/value - By relating the market-clearing price of organs to their usability rates, this paper draws attention on the importance of interdisciplinary studies.