Faculty Publications

Title

A tale of two gate-sharing plans: The national football league and the national league, 1952-1956

Document Type

Article

Journal/Book/Conference Title

Southern Economic Journal

Volume

73

Issue

4

First Page

931

Last Page

946

Abstract

Do professional sports leagues design revenue-sharing rules primarily to help financially weaker teams, or do such organizations view revenue-sharing rules as ways to reward teams for being competitive? Baseball's National League and the National Football League provide evidence from the 1950s that revenue-sharing plans may have surprising effects. If strong teams draw well on the road, revenue-sharing plans may provide modest succor to teams in smaller cities and may benefit teams in larger cities. The two leagues' experiences also suggest that owners are willing to enact regressive aspects in their revenue-sharing plans, possibly to forestall moral hazard possibilities arising from automatically helping teams that remain poor draws or that fail to improve.

Original Publication Date

4-1-2007

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