Stephen F. Ross

Governance and Vertical Integration in Team Sports

Antitrust law distinguishes vertical and horizontal restraints. A horizontal restraint is one which exists between competing firms supplying rival products in a market, and a vertical restraint is one which exists between firms that jointly contribute to supplying a particular product in a market. Horizontal agreements receive much closer antitrust scrutiny because they often enable firms to limit competition at the expense of consumers, while vertical restraints may be legal or illegal depending on whether they tend to enhance or reduce competition or the exploitation of market power. This paper argues that there are important vertical restraints that operate in sports leagues which have been mostly neglected in the literature but have a significant impact. We focus on intraleague restraints, where member clubs of a league agree to control the organization of league competition, and interleague restraints, where horizontal agreement such as the Reserve Clause relies on agreements not to compete for players competing in senior or junior leagues. (JEL L83, L42, L44)

Seizing the Moment: A Blueprint for Reform of World Cricket

We argue that the current match-fixing crisis in world cricket has its origin in the economic structure of the game. Cricketers’ pay is demonstrably low relative to sports of comparable significance and this is a consequence of the organisation of the game with its emphasis on international representative cricket. We propose and outline details of an international club championship with competition for players’ services.

Antitrust and Inefficient Joint Ventures: Why Sports Leagues Should Look More Like Mcdonald's and Less Like the United Nations

Antitrust law generally favors joint ventures that allow separate firms to integrate economic functions while continuing to compete as independent entities. In evaluating the risks to competition that joint ventures could pose, insufficient attention has been paid to the risk that joint ventures with market power may be structured so that the parties, acting in their independent self-interest, will prevent the venture from providing innovative goods and services responsive to consumer demand. In these cases, it may be better if a single firm provided services rather than having them provided jointly.

Antitrust, Professional Sports, and the Public Interest

In a number of important cases, antitrust tribunals have intervened in ways that have significantly affected how professional sports are conducted in the United States. This article focuses on 10 important decisions where the courts ruled against sports leagues and will consider whether the public would have been better off with or without antitrust intervention. It is concluded that, in each of these cases, the private ordering challenged by antitrust litigation was not in the public interest. Although in many of the cases an optimal result would be some middle ground between the status quo and the demands of the antitrust plaintiff, in all cases, an optimal result was encouraged or facilitated by intervention.

Why Highly Paid Athletes Deserve More Antitrust Protection Than Ordinary Unionized Workers

Our nations broad consensus about how the American economy should function is expressed in large part through two sets of statutes enacted by Congress -our antitrust and labor laws. The Sherman Act and its statutory progeny mandate a general principle of unrestrained competition in the marketplace as the best mechanism for efficiently allocating resources, preventing unjustified use of economic power, and generally improving the economic welfare of American citizens. The National Labor Relations Act and its statutory progeny mandate a general principle permitting workers to engage in a regulated restraint of competition in the labor market and collective bargaining with employers, as the best mechanism for equalizing bargaining power between workers and management, limiting industrial disruption, and enhancing the economic welfare of millions of American workers (and thereby the American economy generally). In Brown v. Pro Football, Inc.,1 the Supreme Court held that federal labor laws completely shield from antitrust challenge