Neil Longley

Revenue Volatility in German Nonprofit Sports Clubs

Revenue volatility hinders the planning within nonprofit organizations, and as a consequence, it can influence the organization’s contribution to public welfare. To analyze the extent of revenue volatility and its determinants, this paper uses a comprehensive, longitudinal, data set of German nonprofit sports clubs (n = 724). It distinguishes between systematic volatility and club-specific volatility, and argues that a complete understanding of the sources and impacts of volatility requires one to clearly distinguish between the two components. Empirical results indicate that revenue diversification can significantly reduce club-specific volatility, but has more minimal benefits for lowering systematic volatility. It also reveals that clubs that rely more heavily on membership fees, and less on subsidies, appear to have reduced levels of systematic and club-specific volatility, with the impact being much greater for the latter.

A methodology for identifying the impacted groups in referee discrimination studies

This article presents an empirical methodology that allows one to identify the group being discriminated against by sport referees. Reestimating Price and Wolfers (2010, PW) discrimination in foul-calling analysis with our methodology, we find evidence that only black players are discriminated against.

The “Second” Season The Effects of Playoff Tournaments on Competitive Balance Outcomes in the NHL and NBA

Most research on competitive balance (CB) in North American sport leagues examines regular-season outcomes only, and does not analyze the potential impacts of postseason playoff tournaments. This article finds that playoffs do matter in a CB sense, in that they can substantially reconfigure regular-season outcomes. More importantly, they may reconfigure outcomes in a way that is not neutral with respect to payroll. The article finds, for example, that in the NHL over the 1994-2004 time period, team success in the playoffs was much less dependent on payroll than it was during the regular-season. The article also analyzes the differential impacts of the specific type of playoff tournament employed, and finds that the choice of playoff “pooling” structures directly impacts the probability of “upsets” occurring in the playoffs.

The incentive effects of overtime rules in professional hockey - A comment and extension

This article analyzes the incentive effects of the National Hockey Leagues overtime-loss rule by offering an alternative theoretical framework to that of Abrevaya, whose article recently appeared in this journal. Although his theoretical model implied that all teams would find it beneficial to adopt defensive strategies during the late stages of regulation time of a tied game, the model used in this article shows that there are situations where teams will forego such defensive strategies and continue to play offensively aggressive. In particular, the authors show that this decision as to which on-ice strategy to adopt depends crucially on a teams perception of its own on-ice strength, relative to that of its opponent. Using this behavioral model also allows the authors to analyze and compare the incentive effects of a wide range of alternative payoff structures, including the structure currently used in European soccer.

The Migration of African-Americans to the Canadian Football League During the 1950s: An Escape from Racism?

It is the argument of this paper that the literature on mid-century racial discrimination in sport is incomplete in that it ignores the experiences of a small, but relatively significant, group of African-American football players who actually chose to leave their own country – and correspondingly leave the racially-charged environment of mid-twentieth-century USA – to head north to play professional football in the Canadian Football League (CFL). Beginning in 1946, a steady flow of African-Americans began to migrate to the CFL which, at the time, was a legitimate competitor league to the NFL. This paper attempts to test a perception seemingly held by some that, by moving to Canada, African-American football players were able to escape the racial injustices they often suffered in the US. This view appears to have its roots in the notion that Canada is a ‘gentler’, more tolerant society, without the divisive socio-political history that characterizes much of the race relations in the US. This paper tests these notions using a variety of empirical approaches. The results indicate that, while African-Americans were better represented in the CFL relative to the NFL, African-Americans still faced some level of entry discrimination in the CFL. In particular, African-American players in the CFL outperformed their white counterparts on numerous performance dimensions, indicating the overall talent level in the CFL could have been further improved by employing an even greater number of African-Americans. Additionally, the paper finds that those CFL teams that employed the highest percentage of African-Americans were those teams that had the most on-field success. Finally, the paper analyses prices of player trading cards from that era, and finds that cards of African-Americans were undervalued, relative to white CFL players of equal talent.

Congressional complicity in the baseball antitrust exemption: analysing senate voting patterns

This article examines a key congressional vote on preserving baseballs antitrust exemption. It finds that the most important factor influencing a legislators vote was whether there was a Major League Baseball (MLB) team in the legislators constituency. This supports the notion that the professional sports industry has been effective in ‘capturing’ their political overseers.

Team-Level Referee Discrimination in the National Hockey League

Previous research on referee discrimination in penalty calling has been based on relative comparisons across race/ethnic groups, and does not discern whether the findings are based on players of a different or the same race/ethnicity. This paper tests for team-level discrimination amongst professional hockey referees, and finds that French-Canadian referees favor teams, in the form of fewer penalty calls, that have more French-Canadian players. The analysis is undertaken at penalty level to account for additional within-game referee biases and varying costs of player infractions across score margin game states.

The Way Ahead: The Prospects for the Reemergence of Rival Leagues

This book has taken the premise that studying the history of past rival leagues allows one to gain critical insights into the nature of competition and competitiveness in the spectator sport industry; in turn, this allows one to assess whether the current monopoly position of the Big Four will ever be challenged again. In this final chapter, the goal is to identify the unifying themes amongst the specific case studies presented and to begin to build a more general theory as to why established leagues have been able to maintain such absolute dominance.

Some Conceptual Foundations: A Primer on the Economic Structure of Professional Sport

The notion of competition is fundamentally at the core of a capitalist society. When firms actively compete against each other in a market, several social benefits are generated. In general, competition tends to lower costs, reduces production inefficiency, and leads to a more efficient allocation of societal resources. In other words, resources flow to their most productive uses. Competition is a dynamic process in that it is inherently forward looking, leading to innovation and creativity amongst producers. These benefits ultimately flow through to consumers, who enjoy a more wide range of product choices, higher-quality products, and lower prices. In general, the lower the degree of competition in a given market, the less present are these array of benefits—all else equal, less competitive markets can result in greater production inefficiencies, reduced innovation, fewer product choices, and higher prices for consumers, with the latter directly resulting in higher profits for producers.

Explaining Competitiveness: Alternate Theoretical Frameworks

The case histories of rival leagues presented in the previous two chapters are critical to understanding the nature of competition and competiveness in the major professional sport industry. These histories raise several important questions: