Applications of industrial economics to the professional sports industry
Date: 13 May 2014
Venue: University of Antwerp - Promotiezaal Grauwzusters - Lange Sint-Annastraat 7 - 2000 Antwerp
PhD candidate: Thomas Peeters
Principal investigator: Prof Jan Bouckaert
Co-principal investigator: Prof Stefan Kesenne
Short description: Phd defense Thomas Peeters - Faculty of Applied Economics
Abstract: How do sport clubs compete, on and off the playing field? This is the central question in the PhD thesis written by Thomas Peeters. From an economic point of view professional team sports are an extraordinary industry, because its firms (the clubs) simultaneously compete and cooperate. Clubs compete on and off the field for sporting glory, talented players, revenues and media exposure. At the same time, firms have to work together to agree schedules, playing rules etcetera. As a result sports clubs all over the world have created agreements, which would be completely unacceptable between competing firms in any other industry. Famous examples include the joint selling of media rights, "salary caps" and gate revenue sharing in the US major leagues and the recently introduced "Financial Fair Play" rules in European football. Clubs argue that these rules enhance the quality of the sporting competition and therefore serve the interests of consumers (the fans). Critics have however put forward strong skepticism regarding the alleged positive effects of these rules and stress that they primarily increase the profitability of the teams. Given the amount of media attention which professional sports generate, it comes as no surprise that the correct application of competition rules in this industry has been a topic of intense debate. This thesis sheds new light on this issue in four papers which study the industrial organization of the professional sports industry.