The Determinants Of The TV Demand Of Soccer: Empirical Evidence On Italian Serie A For The Period 2008-2015

Caruso, Raul and Addesa, Francesco and Di Domizio, Marco (2016): The Determinants Of The TV Demand Of Soccer: Empirical Evidence On Italian Serie A For The Period 2008-2015.

Abstract

This paper investigates the determinants of TV audience for Italian soccer. After a review of the literature concerning the key factors driving the demand for sport, we analyse SKY’s audience figures for 7 Serie A seasons (from 2008-09 to 2014-15). Applying different OLS specifications, we show that Italian viewers have a committed behaviour and outcome uncertainty does not have a significant impact on TV audience. In addition, when choosing whether to watch a match of teams other than their favourite team, Italian consumers appear to be particularly attracted by both the aggregate quantity of talent present and by matches involving teams at the top of the table. This suggests that, in the Italian context, an increase in the TV demand is mainly driven by an enhancement in the performance of top clubs and in the quality of the entertainment rather than in competitive balance.

• Item Type: MPRA Paper
• Language: English
• Keywords: Broadcasting; Soccer; TV Demand; Uncertainty of Outcome hypothesis; Talent; Serie A.
• Subjects: D - Microeconomics > D1 - Household Behavior and Family Economics > D12 - Consumer Economics: Empirical Analysis; D - Microeconomics > D7 - Analysis of Collective Decision-Making; L - Industrial Organization > L2 - Firm Objectives, Organization, and Behavior > L25 - Firm Performance: Size, Diversification, and Scope; L - Industrial Organization > L8 - Industry Studies: Services > L83 - Sports ; Gambling ; Restaurants ; Recreation ; Tourism

References

Alavy, K., Gaskell, A., Leach, S., & Szymanski, S. (2010). On the Edge of Your Seat: Demand for Football on Television and the Uncertainty of Outcome Hypothesis. International Journal of Sport Finance, 5(2), 75–95.

Aldrich, E. M., Arcidiacono, P. S., & Vigdor, J. L. (2005). Do People Value Racial Diversity? Evidence from Nielsen Ratings. Topics in Economics Analysis and Policy, 5(1), Art. 4.

Allan, G., & Roy, G. (2008). Does Television Crowd Out Spectators? New Evidence from the Scottish Premier League. Journal of Sports Economics, 9(6), 592-605.

Baroncelli, A., & Caruso, R. (2011). The Organization and Economics of Italian Top Football. In H. Gammelsæter, & B. Senaux (Eds.), The Organization and Governance of Top Football Across Europe, 168-181. London: Routledge.

Borland, J., & Maconald, R. (2003). Demand for Sport. Oxford Review of Economic Policy, 19(4), 478-502.

Buraimo, B., Forrest, D., & Simmons, R. (2006). Robust Estimates of the Impact of Broadcasting on Match Attendance in Football. Lancaster University Management School Working Paper, 2006/004, 1-26.

Buraimo, B. (2008). Stadium Attendance and Television Audience Demand in English League Football. Managerial and Decision Economics, 29(6), 513-523.

Buraimo, B., Forrest, D., & Simmons, R. (2008). Outcome Uncertainty Measures: How Closely Do They Predict a Close Game? In J. Albert, & R.H. Koning (Eds.), Statistical Thinking in Sports (pp.167-178). Boca Ranton (FL): Chapman & Hall.

Buraimo, B., & Simmons, R. (2008). Do Sport Fans Really Value Uncertainty of Outcome? Evidence from the English Premier League. International Journal of Sport Finance, 3(3), 146-155.

Buraimo, B., & Simmons, R. (2009). A Tale of Two Audiences: Spectators, Television Viewers and Outcome Uncertainty in Spanish Football. Journal of Economics and Business, 61(4), 326-338.

Buraimo, B., & Simmons, R. (2015). Uncertainty of Outcome or Star Quality? Television Audience Demand for English Premier League Football. International Journal of Economics of Business, 22(1), 1-21.

Cairns J. A. (1987), Evaluating Changes in League Structure: the Reorganization of the Scottish Football League, in Applied Economics, 19 (2), 259-275.

Caruso, R., & Di Domizio, M. (2015). Hooliganism and Demand for Football in Italy: Attendance and Counterviolence Policy Evaluation. German Economic Review, 16(2), 123-137.

Caruso, R., & Di Domizio, M. (2015). La Serie A in Televisione e allo Stadio: Presentazione del Dataset AUDIBALL1.0. Rivista di Diritto ed Economia dello Sport, 15(1), 161-185.

Coates, D., & Humphreys, B. R. (2010), Week to Week Attendance and Competitive Balance in the National Football League, International Journal of Sport Finance, 5(4), 239-252.

Coates, D., & Humphreys, B. R. (2012), Game Attendance and Outcome Uncertainty in the National Hockey League, Journal of Sports Economics, 13(4), 364-377.

Czarnitzki, D., & Stadtmann, G. (2002). Uncertainty of Outcome Versus Reputation: Empirical Evidence for the First German Football Division. Empirical Economics, 27(1), 101-112.

Dang, T. M., Booth, R., Brooks, R., & Schnytzer, A. (2015). Do TV Viewers Value Uncertainty of Outcome? Evidence from the Australian Football League. Economic Record, 91(295), 523-535.

Deloitte (2015). Annual Review of Football Finance. Retrieved from http://www2.deloitte.com/uk/en/pages/sports-business-group/articles/annual-review-of-football-finance.html (last access: January 2015).

Di Domizio, M. (2010). Competitive Balance e Audience Televisiva: una Analisi Empirica della Serie A Italiana. Rivista di Diritto ed Economia dello Sport, 16(1), 27-57.

Dietl, H. M., Grossmann, M., & Lang, M. (2011), Competitive Balance and Revenue Sharing in Sports Leagues With Utility-Maximizing Teams. Journal of Sports Economics, 12(3), 284-308.

Dobson, S., & Goddard, J. (2008). Forecasting Scores and Results and Testing the Efficiency of the Fixed-odds Betting Market in Scottish League Football. In J. Albert, & R.H. Koning (Eds.), Statistical Thinking in Sports (91-109). Boca Ranton (FL): Chapman & Hall.

El-Hodiri, M., & Quirk, J. (1971). An Economic Model of Professional Sports Leagues. Journal of Political Economy, 79(6), 1302-1319.

Feddersen, A., & Rott, A. (2011). Determinants of Demand for Televised Live Football: Features of the German National Football Team. Journal of Sports Economics, 12(3), 352-369.

Forrest, D., Simmons, R., & Szymanski, S. (2004). Broadcasting, Attendance and the Inefficiency of Cartels. Review of Industrial Organization, 24(3), 243–265.

Forrest, D., Simmons, R., & Szymanski S. (2005). Outcome Uncertainty and the Couch Potato Audience. Scottish Journal of Political Economy, 52(4), 641-661.

Fort, R., & Quirk, J. (1995). Cross-subsidization, Incentives, and Outcomes in Professional Team Sports Leagues. Journal of Economic Literature, 33 (September), 1265-1299.

Fort, R., & 0Quirk, J. (2010). Optimal Competitive Balance in Single-Game Ticket Sports Leagues. Journal of Sports Economics, 11(6), 589-601.

Fort, R., & Quirk, J. (2011). Optimal Competitive Balance in a Season Ticket League. Economic Inquiry, 49(2), 464-473.

Funk, D. C., Mahoney, D. F., & Havitz, M. E. (2003). Sport Consumer Behaviour: Assessment and Direction. Sport Marketing Quarterly, 12(4), 200-205.

Garcia, J., & Rodriguez, P. (2002). The Determinants of Football Match Attendance Revisited: Empirical Evidence from the Spanish Football League. Journal of Sports Economics, 3(1), 18-38.

Hall, M., Szymanski, S., & Zimbalist, A. (2002). Testing Causality Between Team Performance and Payroll: The Case of Major League Baseball and English Soccer. Journal of Sports Economics, 3(2): 149-168.

Hausman, J. A., & Leonard, G. K. (1997). Superstars in the National Basketball Association: economic value and Policy. Journal of Labor Economics, 15(4), 586-624.

Hoehn, T., & Szymanski, S. (1999). The Americanization of European Football. Economic Policy, 14(28), 205-240.

Hunt, K. A., Bristol, T., & Bashaw R. E. (1999). A Conceptual Approach To Classifying Sport Fans. Journal of Services Marketing, 13(6), 439-452.

Jennet, N. (1984). Attendances, Uncertainty of Outcome and Policy in Scottish League Football. Scottish Journal of Political Economy, 31(2), 176-198.

Kanazawa, M. T., Funk, J. P. (2001). Racial Discrimination in Professional Basketball: Evidence From Nielsen Ratings. Economic Inquiry, 39(4), 599–608.

Kuypers, T. (1996). The Beautiful Game? An Econometric Study of Why people Watch English Football. Discussion papers in economics, Department of Economics, University College London, 96-01.

Mills, B., & Fort, R. (2014). League-Level Attendance and Outcome Uncertainty in U.S. Pro Sports Leagues. Economic Inquiry, 52(1), 205-218.

Mongeon, K., & Winfree, J. (2012). Comparison of Television and Gate Demand in the National Basketball Association. Sport Management Review, 15(1), 72-79.

Neale, W.C. (1964). The Peculiar Economics of Professional Sports, A Contribution to the Theory of the Firm in Sporting Competition and in Market Competition. Quarterly Journal of Economics, 78(1), 1-14.

Pacey, P. L., & Wickham, E. D. (1985). College Football Telecasts: Where Are They Going? Economic Inquiry, 23(1), 93–113.

Paul, R. J., & Weinbach, A. P. (2007). The Uncertainty of Outcome and Scoring Effects on Nielsen Ratings for Monday Night Football. Journal of Economics and Business, 59(3), 199-211.

Pawlowski, T. (2014). Testing the Uncertainty of Outcome Hypothesis in European Professional Football - A Stated Preference Approach. Journal of Sports Economics, 14(4), 341-367.

Peel, D. A., & Thomas, D. A (1988). Outcome Uncertainty and the Demand for Football: an Analysis of Match Attendances in the English Football League. Scottish Journal of Political Economy, 35(3), 242-249.

Peel, D. A., & Thomas, D. A. (1992). The Demand for Football: Some Evidence on Outcome Uncertainty. Empirical Economics, 17(2), 323-331.

Pope, P. F., & Thomas, D. A. (1989). Information, Prices and Efficiency in a Fixed-odds Betting Market. Economics, 56(223), 323-341.

Robinson, M. J., & Trail, G. T. (2005). Relationships Among Spectator Gender, Motives, Points of Attachment, and Sport Preference. Journal of Sport Management, 19(1), 58-80.

Rodney, P., Weinbach, A., Borghesi, R., & Wilson, M. (2009). Using Bettings Odds to Measure the Uncertainty of Outcome in Major League Baseball. International Journal of Sport Finance, 4(2), 255-263.

Rodríguez, C., Pérez, L., Puente, V., & Rodríguez, P. (2015). The Determinants of Television Audience for Professional Cycling: The Case of Spain. Journal of Sports Economics, 16(1), 26-58.

Rottenberg, S. (1956). The Baseball Players’ Labour Market. Journal of Political Economy, 64(3), 242-258.

Salaga, S., & Tainsky, S. (2015). The Effects of Outcome Uncertainty, Scoring, and Pregame Expectations on Nielsen Ratings for Bowl Championship Series Games. Journal of Sports Economics, 16(5) 439-459.

Sloane, P. J. (1971). The Economics of Professional Football: The Football Club as Utility Maximizer. Scottish Journal of Political Economy, 4(2), 87-107.

Štrumbelj, E. (2016). A Comment on the Bias of Probabilities Derived From Betting Odds and Their Use in Measuring Outcome Uncertainty. Journal of Sports Economics, 17(1), 12-26.

Szymanski, S., (2001). Income inequality, Competitive Balance and Attractiveness of Team Sports: Some evidence and a Natural Experiment from English Soccer. Economic Journal, 111(469), 69-84.

Szymanski, S. (2003). The Economic Design of Sporting Contests. Journal of Economic Literature, 41(4), 1137-1187.

Tainsky, S. (2010). Television Broadcast Demand for National Football League Contests. Journal of Sports Economics, 11(6), 629-640.

Tainsky, S., & McEvoy, C. D. (2012). Television Broadcast Demand in Markets without Local Teams. Journal of Sports Economics, 13(3), 250-265.

Tapp, A. (2004). The Loyalty of Football Fans – We’ll Support You Evermore? The Journal of Database Marketing & Customer Strategy Management, 11(3), 203-215.