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The Regional Effects of Professional Sports Franchises – Causal Evidence from Four European Football Leagues

We use the locational pattern of clubs in four major professional football leagues in Europe to test the causal effect of changes in premier league membership on regional employment and output growth at the NUTS 3 level. We rely on the relegation mode of the classical round-robin tournament in the European model of sport to develop a regression-discontinuity design. The results indicate small and significant negative short-term effects on regional employment and output in the sports-related economic sector when clubs are relegated from the premier division of the respective football league. In addition, we find small negative effects on overall regional employment growth. However, total regional gross value added remains unaffected, indicating that in the main it is the less productive jobs that disappear in the short-term.

30. Mai 2018

Autoren Matthias Brachert

Highlights

  • We analyse the regional effects of events where premier league clubs have to relegate from four major professional football leagues in Europe.
  • The analysis is based on regionally and sectorally disaggregated data at the European NUTS 3 level in the period 1995 to 2012.
  • A regression-discontinuity design is employed to estimate causal effects of these.
  • We find negative short-run effects of relegations on sectoral employment and output and small negative effects on overall regional employment growth.

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