Review: Sports League Profit and Market Sizes
作者: Jason Winfree, Connor Allen, Stefan Szymanski出版資訊: International Journal of Sport Finance, Volume 19, Number 1, Pages 25–38, 2024. DOI: 10.32731/IJSF/191.022024.02
摘要
本文探討了體育聯盟在選擇市場規模時的經濟效益,並挑戰了「聯盟應將球隊安置於最大市場」的傳統觀點。基於經濟模型,研究發現市場規模的異質性可能增加聯盟總收益,儘管這可能導致競爭不均衡。小市場球隊的存在能降低人才競爭成本,並可能提高整體聯盟利潤。相對於大市場球隊的優勢,小市場的加入在特定條件下反而能對聯盟有利。
主要貢獻
重新評估市場選擇策略:本文指出,聯盟的整體利潤最大化並不總是依賴於選擇最大市場,小市場能帶來更高收益的潛在可能性。
挑戰競爭平衡假設:過往文獻認為,競爭平衡對消費者需求至關重要,但本研究表明,競爭不平衡對收入的影響可能較小,甚至在某些情況下有助於提高利潤。
擴展理論模型:通過結合市場規模的異質性與投資水平,建立了新的經濟模型,量化了不同條件下聯盟利潤的變化。
研究方法
經濟模型設計:
應用雙隊比賽模型,基於競爭成功函數(CSF),模擬球隊投資如何影響勝率與收益。
假設市場規模(σ)影響球隊的收入與投資決策。
數學分析:
採用反向歸納法分析球隊的最佳投資策略。
模擬不同市場規模下聯盟總利潤的變化,並繪製總利潤與市場規模的關係曲線。
實證數據參考:
使用美國職業聯盟(MLB、NBA、NFL)的市場人口數據進行對比分析,以評估模型結論的現實適用性。
結果與建議
理論結果:聯盟總利潤在市場規模適度不平衡的情況下最大化,這主要是由於降低了人才競爭成本。小市場球隊的存在限制了大市場球隊的投資需求,從而減少了整體聯盟的支出。
實踐洞察:
聯盟在進行球隊擴展或遷移時,不應僅考慮最大市場,而應關注市場規模的多樣性及其對利潤的潛在影響。
需警惕過度競爭平衡對收益的可能負面影響。
未來研究方向:
深入探討市場規模對球隊投資與聯盟收益的非線性影響。
實證測試模型假設,特別是小市場對聯盟長期經濟效益的影響。
結論本研究為體育聯盟的市場選擇提供了新的視角,強調市場規模異質性對利潤最大化的重要性。未來研究應進一步實證化模型,並探討如何最佳化市場分配策略以提升聯盟的經濟績效。
作者Jason Winfree, Connor Allen, Stefan Szymanski
Citation: Winfree, J., Allen, C., & Szymanski, S. Sports League Profit and Market Sizes. International Journal of Sport Finance, 2024, 19, 25–38. DOI: 10.32731/IJSF/191.022024.02.
體育聯盟利潤與市場規模回顧
作者: Jason Winfree、Connor Allen、Stefan Szymanski
出版資訊: International Journal of Sport Finance,第 19 卷,第 1 期,第 25-38 頁,2024 年。DOI: 10.32731/IJSF/191.022024.02
摘要
本文探討了體育聯盟在選擇市場規模時,市場規模的異質性如何影響聯盟的經濟效益,並挑戰了「聯盟應將球隊安置於最大市場」的傳統觀點。 過去的文獻通常假設聯盟會偏好將球隊置於最大的市場。 然而,基於經濟模型分析,研究發現市場規模的異質性(即大小市場混合)實際上可能增加聯盟總收益,儘管這可能導致競爭不均衡。 小市場球隊的存在可以降低人才競爭的成本,並且在特定條件下可能提高整體聯盟的利潤。 簡而言之,相對於大市場球隊的優勢,小市場球隊的加入在特定條件下反而能對聯盟有利。
主要貢獻
- 重新評估市場選擇策略: 本文指出,聯盟的整體利潤最大化並不總是依賴於選擇最大市場,小市場的加入能帶來更高收益的潛在可能性。
- 挑戰競爭平衡假設: 過往文獻認為,競爭平衡對消費者需求至關重要,但本研究表明,競爭不平衡對收入的影響可能較小,甚至在某些情況下有助於提高利潤。
- 擴展理論模型: 通過結合市場規模的異質性與投資水平,建立了新的經濟模型,量化了不同條件下聯盟利潤的變化。
研究方法
1. 經濟模型設計:
- 應用雙隊比賽模型,基於競爭成功函數(CSF),模擬球隊投資如何影響勝率與收益。
- 假設市場規模(σ)影響球隊的收入與投資決策。
2. 數學分析:
- 採用反向歸納法分析球隊的最佳投資策略。
- 模擬不同市場規模下聯盟總利潤的變化,並繪製總利潤與市場規模的關係曲線。
3. 實證數據參考:
- 使用美國職業聯盟(MLB、NBA、NFL)的市場人口數據進行對比分析,以評估模型結論的現實適用性。
結果與建議
- 理論結果: 聯盟總利潤在市場規模適度不平衡的情況下最大化,這主要是由於降低了人才競爭成本。 小市場球隊的存在限制了大市場球隊的投資需求,從而減少了整體聯盟的支出。
- 實踐洞察:聯盟在進行球隊擴展或遷移時,不應僅考慮最大市場,而應關注市場規模的多樣性及其對利潤的潛在影響。
- 需警惕過度競爭平衡對收益的可能負面影響。
未來研究方向:
- 深入探討市場規模對球隊投資與聯盟收益的非線性影響。
- 實證測試模型假設,特別是小市場對聯盟長期經濟效益的影響。
結論
本研究為體育聯盟的市場選擇提供了新的視角,強調市場規模異質性對利潤最大化的重要性。 未來研究應進一步實證化模型,並探討如何最佳化市場分配策略以提升聯盟的經濟績效。
作者
Jason Winfree, Connor Allen, Stefan Szymanski
引用
Winfree, J., Allen, C., & Szymanski, S. Sports League Profit and Market Sizes. International Journal of Sport Finance, 2024, 19, 25–38. DOI: 10.32731/IJSF/191.022024.02.
Sports League Profit and Market Sizes Review
Authors: Jason Winfree, Connor Allen, Stefan Szymanski
Publication Information: International Journal of Sport Finance, Volume 19, Number 1, Pages 25–38, 2024. DOI: 10.32731/IJSF/191.022024.02
Abstract
This article explores how the heterogeneity of market size affects the economic benefits of sports leagues when selecting market sizes, and challenges the traditional view that "leagues should place teams in the largest markets". Previous literature often assumes that leagues prefer to place teams in the largest markets. However, based on economic model analysis, the study finds that market size heterogeneity (i.e., a mix of large and small markets) may actually increase total league revenue, although this may lead to competitive imbalance. The existence of small-market teams can reduce the cost of talent competition and may improve overall league profits under certain conditions. In short, compared to the advantages of large-market teams, the addition of small-market teams can actually be beneficial to the league under certain conditions.
Main Contributions
- Re-evaluation of market selection strategies: This article points out that maximizing overall league profit does not always depend on choosing the largest market, and the addition of small markets can potentially bring higher revenue.
- Challenge the competitive balance hypothesis: Previous literature believes that competitive balance is crucial to consumer demand, but this study shows that the impact of competitive imbalance on revenue may be small, and even in some cases, it helps to increase profits.
- Expansion of the theoretical model: By combining market size heterogeneity and investment levels, a new economic model is established to quantify the changes in league profit under different conditions.
Research Methods
1. Economic model design:
- Apply a two-team game model based on the contest success function (CSF) to simulate how team investment affects winning percentage and revenue.
- Assume that market size (σ) affects the revenue and investment decisions of the team.
2. Mathematical analysis:
- Use backward induction to analyze the optimal investment strategy of the team.
- Simulate the changes in total league profit under different market sizes, and draw the relationship curve between total profit and market size.
3. Empirical data reference:
- Use market population data from American professional leagues (MLB, NBA, NFL) for comparative analysis to evaluate the practical applicability of the model conclusions.
Results and Recommendations
- Theoretical results: Total league profit is maximized when the market size is moderately imbalanced, which is mainly due to the reduced cost of talent competition. The existence of small-market teams limits the investment needs of large-market teams, thereby reducing the overall expenditure of the league.
- Practical insights:When expanding or relocating teams, leagues should not only consider the largest market, but should also pay attention to the diversity of market sizes and their potential impact on profits.
- Be wary of the possible negative impact of excessive competitive balance on revenue.
Future research directions:
- In-depth exploration of the nonlinear impact of market size on team investment and league revenue.
- Empirical testing of model assumptions, especially the impact of small markets on the long-term economic benefits of the league.
Conclusion
This study provides a new perspective on market selection for sports leagues, emphasizing the importance of market size heterogeneity for profit maximization. Future research should further empirically validate the model and explore how to optimize market allocation strategies to enhance the economic performance of the league.
Authors
Jason Winfree, Connor Allen, Stefan Szymanski
Citation
Winfree, J., Allen, C., & Szymanski, S. Sports League Profit and Market Sizes. International Journal of Sport Finance, 2024, 19, 25–38. DOI: 10.32731/IJSF/191.022024.02.
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