Articles in this issue:

  • Daniel A. Rascher
    John Paul G. Solmes

    The National Basketball Association claims to sell entertainment. Part of that entertainment is close, competitive contests with uncertain outcomes. However, hometown fans want the home team to win. Hence, the optimal probability that the home team wins a game, from the perspective of maximizing demand, lays somewhere between 0.5 and 1.0. Using data from individual games for the 2001-02 season, this optimal probability was estimated to be approximately 0.66. Fans want their home team to have about twice the chance to win a game as the visiting team.Read more

  • Stefan Kesenne

    In a sports league, team owners can expect to increase player performance, and the team’s winning percentage or profits, by providing a win bonus on top of the players’ fixed salary level. In some clubs, the guaranteed player salary is relatively low and the premium, in case of a winning game, relatively high, whereas in other clubs, hardly any win bonus is paid. In this theoretical paper, we investigate what the impact of a win bonus is on the winning percentage, the competitive balance, the owner profits, and the overall quality in a professional sports league. The model we start from is...Read more

  • Matthew Walker
    Michael J. Mondello

    The issue related to public investment in sport facilities has generated lively debate between economists, researchers, and policy makers. Empirical evidence detailing benefits derived from such initiatives has become mired in the discussion of whether sports stadiums do serve as economic catalysts. Research has demonstrated that new stadiums and arenas have no significant fiduciary impact on local economies, including employment. However, a possibility not fully explored is the idea that stadiums and teams generate both tangible and intangible benefits that can support the justification...Read more

  • Dennis Coates
    Brad R. Humphreys

    This paper explores the demand for attendance at professional sporting events using a data set that includes ticket prices and a price index reflecting prices for ancillary goods associated with attendance. Previous research has focused on attendance at Major League Baseball games, but this study also includes attendance at NBA and NFL contests. The analysis largely confirms existing findings that attendance demand is price inelastic, a result that is often thought to be at odds with the monopoly status of professional sports franchises. The analysis shows that ticket pricing in the...Read more