Determinants of Professional Sports Firm Values in the United States and Europe: A Comparison between Sports over the Period 2004-2011

Abstract

Since the beginning of the nineties, professional sports firm values have been estimated by American newspapers. In 2004, Forbes proposed for the first time a list of the most valuable European soccer teams. In this article, we compare the determinants of firm values in MLB, the NBA, NFL, NHL, and European soccer over the period 2004-2011. The results show only one variable for which the sign and significance are the same for all the leagues: historical sports performance, with a significantly positive impact in each league. The comparison between the United States and Europe reveals that a majority of differences seem to indicate that the determinants of team values in the United States are not the same as those in Europe. Lastly, we proposed avenues for future research: integrating an international dimension that could be measured through the number of fans on social media and player values.

Keywords

professional sports firms value United States Europe

Get full access to this article

View all access options for this article.

References

Aglietta

, Andreff

, & Drut

(2008). Bourse et football. Revue d'Économie Politique, 118, 255–296.

Alexander

D. A.

, & Kern

(2004). The economic determinants of professional sports franchise values. Journal of Sports Economics, 5, 51–66.

Andreff

(2007). Régulation et institutions en économie du sport. Revue de la régulation, 1. Paris, France: Varia.

Büschemann

, & Deutscher

(2011). Did the 2005 collective bargaining agreement really improve team efficiency in the NHL? International Journal of Sport Finance, 6, 298–306.

Desbordes

(Ed.) (2007). Marketing and football: An international perspective. Oxford, UK: Butterworth-Heinemann (Elsevier).

Durand

, Ravenel

, & Helleu

(2005). Basket professionnel en France: Approche stratégique et géomarketing. Voiron, France: Presses Universitaires du Sport.

Helleu

, Scelles

, & Durand

(2011). Que vaut un club ? L'évolution de la valeur des firmes sportives professionnelles en Europe et Amérique du Nord. Communication in the colloquium État de la recherche en Management du Sport en langue française, Strasbourg, France, June 16–17.

Hoehn

, & Szymanski

(1999). The Americanization of European football. Economic Policy, 28, 202–240.

Humphreys

B. R.

, & Lee

Y.S.

(2010). Determinants of franchise values in North American professional sports leagues: Evidence from a hedonic price model. International Journal of Sport Finance, 5, 280–295.

10.

Humphreys

B. R.

, & Mondello

(2008). Franchise values in North American professional sports leagues: Evidence from the repeat sales method. International Journal of Sport Finance, 3, 98–105.

11.

Miller

(2007). Private financing and sports franchises values: The case of Major League Baseball. Journal of Sports Economics, 8, 449–467.

12.

Miller

(2009). Facility age and ownership in major American team sports leagues: The effect on team franchise values. International Journal of Sport Finance, 4, 176–191.

13.

Noll

R. G.

(2003). The organization of sports leagues. SIEPR Discussion Paper No. 02–43.

14.

Scelles

, Helleu

, & Durand

(2012). Les déterminants de la valeur financière des clubs sportifs professionnels: Le cas du football européen sur la période 2004-2011. Cesam S unpublished paper.

15.

Scelles

, Helleu

, Durand

, & Bonnal

(2013). What impacts of the globalization of a sport on the number of social media fans for professional sports clubs and on their value in the United States and in Europe? 12th International Business & Economy Conference, Caen, France, 9–12 January.

16.

Szymanski

(2003). The economic design of sporting contests. Journal of Economic Literature, 41, 1137–1187.