IJSF Issue 5:1

Contents for IJSF Issue 5:1

The Length and Success of NBA Careers: Does College Production Predict Professional Outcomes?, pp. 4-26
Authors: Dennis Coates and Babatunde Oguntimein
Abstract:This paper uses data on players drafted in 1987 through 1989 covering both their collegiate and their professional careers. This time period is chosen because we wanted recent players whose playing days have ended. Our analysis evaluates the role of college productivity on draft position and the relationship between college career productivity, measured by individual performance statistics and as productivity indexes, with professional career productivity measured similarly and with the length of the career. At issue is the effectiveness of NBA executives in identifying college players who will be successful in the pros. The results suggest that some college productivity significantly influences draft position and that the nature of that influence differs with the nature of the college conference from which a player is taken. Draft position also affects the length of a player’s career, with earlier draftees having longer careers.

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Guest Editor’s Note: The Financial Crisis in European Football: Proceedings of the Conference on Football and Finance, pp. 27
Authors: Bernd Frick
Abstract:The revenues of professional football clubs in Europe have increased enormously over the last decades. The big five European leagues (England, France, Germany, Italy, and Spain) in 2007-08 generated revenues of almost €10 billion, of which €3 billion have to be attributed to the English Premier League and €1.8 billion each to the Spanish “La Liga,” the Italian “Serie A,” and the German “Bundesliga.”

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The Financial Crisis and English Football: The Dog That Will Not Bark, pp. 28-40
Authors: Stefan Szymanski
Abstract:This paper considers the financial crisis of 2008 and its likely impact on English football, notably the English Premier League. It mostly examines the history of financial instability and sporting stability, in the sense of club survival, that is characteristic of English football and possibly much of football in the rest of the world. The paper suggests that while shareholders often lose money, clubs seldom disappear. It also suggests that while clubs are not immune to economic cycles, the impact is likely to be limited. The reasons for the financial instability of particular clubs and stability and success of the English leagues are discussed.

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The Effect of Luxury Taxes on Competitive Balance, Club Profits, and Social Welfare in Sports Leagues, pp. 41-51
Authors: Helmut M. Dietl, Markus Lang, and Stephan Werner
Abstract:This paper presents a model of a professional sports league and analyzes the effect of luxury taxes on competitive balance, club profits, and social welfare. It shows that a luxury tax increases aggregate salary payments in the league and produces a more balanced league. Moreover, a higher tax rate increases the profits of large-market clubs, whereas the profits of small-market clubs only increase if the tax rate is not set inadequately high. Finally, we show that social welfare increases with a luxury tax.

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Spanish Football Clubs Finances: Risis and Player Salaries, pp. 52-66
Authors: Ángel Barajas and Plácido Rodríguez
Abstract:This paper shows the current financial situation of Spanish professional football. Different financial ratios are used in order to classify the financial position of the different teams. The study has been split between clubs in First or Second division. We also analyze the relationships between the size of market, team payrolls, and team performance. We demonstrate the financial problems created by the arms race that clubs have started for getting the most talented players for trying to get the best possible sporting outcome. The new Spanish Law for companies in financial distress has implied that nine clubs are technically insolvent and under administration. We have searched for possible explanations of that situation. Nevertheless, our financial variables do not explain the likelihood that a club goes into administration.

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The Financial Situation of the Football Clubs in the Belgian Jupiler League: Are Players Overpaid in a Win-Maximization League?, pp. 67-71
Authors: Stefan Kesenne
Abstract:Most professional football clubs in Belgium are facing financial problems. In this note, we try to find out if the poor financial situation of many Belgian football clubs is caused by player salaries that are too high. In other words: are professional football players in Belgium overpaid?

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