Articles in this issue:

• Stock Market Reaction to Mega-Sport Events: Evidence from South Africa and Morocco

  Thabo J. Gopane and Reggy M. Mmotla

  This paper investigates the domestic stock market reaction to the announcement of South Africa winning the bid to host the 1995 Rugby World Cup, 2003 Cricket World Cup, and 2010 FIFA World Cup as well as Morocco concurrently losing the hosting competition for the 2010 FIFA World Cup. We used Event Study and EGARCH models. For Event Study, we evaluated normal market performance using 250 daily stock returns, while abnormal returns were tested within a 41-day (-20, +20) event window. The test was replicated using 2,227 daily compounded stock returns for the EGARCH model. Based on both the...Read more

• Ratcheting Up: Adjusting the Incentives in the NBA Draft

  Barbara Arel and Michael J. Tomas III

  In this paper, we develop a modified salary scale for NBA rookies that adjusts player financial incentives to enter the draft early. Our proposed “ratcheting” salary schedule pays different salary amounts depending on draft pick and the number of years the player delayed entry to the draft to alter the financial incentives of declaring early. We analyze this proposed new salary scale using a put option analogy to determine early exercise boundary positions in which there is no value in the option to delay entry into the draft. The results show that under a ratchet salary system the...Read more

• A Prediction Model for Bankruptcy of Football Clubs: The French Case

  Yann Carin

  European football in general, and French football in particular, is experiencing huge financial difficulties and insolvencies. This paper analyses the bankruptcy of French football clubs between the 2008/09 and 2015/16 seasons. Various prediction models were used over the period 2008/09 and 2013/14 to create a model applied to French football and to provide regulatory bodies with an additional tool that could be used to evaluate clubs. A validation test was made on the 2014/15 and 2015/16 seasons. This paper shows that a prediction model for bankruptcy cannot be generalized to apply to all...Read more

• The Effect of Investment in European Football on the Market Value of Chinese Corporations

  Yangyang Chen

  Helmut M. Dietl

  Johannes Orlowski

  and Fang Zheng

  This paper analyzes how investments in professional European football clubs affect the market value of Chinese corporations. Twelve acquisition cases with complete stock return data are identified between 2009 and 2017. Applying traditional financial event study methodology, it appears that Chinese corporations, on average, do not earn abnormal returns as a result of their investments in professional European football clubs. However, as exceptions to this finding, a few corporations show significant positive or negative abnormal returns. This study also hints at an association between the...Read more

• Nonprofit Pricing: Determinants of Membership Fee Levels in Nonprofit Sports Clubs in Germany

  Svenja Feiler

  Pamela Wicker

  and Christoph Breuer

  In Germany, membership fees in nonprofit sports clubs are comparatively lower than fees or prices for other leisure time activities, such as sports offers from fitness clubs, music schools, or theatre visits. However, it is unclear on which basis sports clubs set their membership fees for different groups and why fees differ between clubs. Based on panel data of nonprofit sports clubs in Germany (n=1,538), this study investigates which factors influence the setting of membership fee levels using classical pricing-approaches adapted to the nonprofit context. The results show that costs...Read more