The organisers of most professional sports leagues now employ one or more forms of policy
intervention such as revenue sharing and salary capping schemes. The focus of the sports economic
literature was initially
directed towards
the theoretical effects o
f these policies on competitive
balance, wage rates and owner profits in the context of Major US sports leagues. That work has
since been broadened in the literature to include other types of policy intervention and other model
assumptions such as ‘win ma
ximising’ owners and ‘open’ labour markets that characterise other
professional leagues such as for association football.
This paper
consolidates the analytical treatment
in the sports economics literature
of both product
market and labour market policy i
nterventions by league sports organisers to form a standardised
set of techniques presented in a generally accessible format. This is intended to provide the reader
with the method and approach for similar analysis of other combinations of assumptions and
policy
specification as appropriate to particular professional sports leagues.
More recent policy intervention has included the regulation of financial performance of professional
(association) football clubs. This paper
adds to the literature by
also pr
ovid
ing
a framework for
analysing the effect of this policy intervention on
professional sports clubs
