The article proposes a new “strategic market game” (SMG) approach to modeling strategic interactions between clubs in professional team sports leagues, and generalizes a basic framework used in previous literature (two clubs, fixed talent supply and club revenues that depend only on relative...

This paper outlines how the theory of contests is applied to professional team sports leagues. In the first part, we present the traditional Tullock contest and explain some basic properties of the equilibrium. We will then extend this static contest to a two-period model in order to analyze...

This paper outlines how the theory of contests is applied to professional team sports leagues. In the first part, we present the traditional Tullock contest and explain some basic properties of the equilibrium. We will then extend this RePEc/rsd contest to a two-period model in order to analyze...

This article presents a model of talent investments where two clubs compete for prizes. Our model is based on a general class of cost functions with a constant elasticity of marginal costs with respect to investments. The analysis finds that reduced revenue sharing improves competitive balance....

As sports clubs jointly produce contests, they cannot determine contest quality through their private talent investments. Sports leagues therefore try to coordinate talent investments towards the profit-maximizing contest quality. In this paper I analyze how revenue sharing mechanisms may serve...

The author discusses the optimal sharing of broadcasting revenues given a central marketing system. A league's sports association wants to maximize the joint profits of the sports clubs' owners. The results show that a winner-take-all scheme should be used if the teams are homogeneous. However,...

This paper outlines how the theory of contests is applied to professional team sports leagues. In the first part, we present the traditional Tullock contest and explain some basic properties of the equilibrium. We will then extend this RePEc/iso contest to a two-period model in order to analyze...