THE FOOTBALL PLAYERS' LABOR MARKET: EMPIRICAL EVIDENCE FROM THE MAJOR EUROPEAN LEAGUES
| DOI | http://doi.org/10.1111/j.1467-9485.2007.00423.x |
| Date | 01 July 2007 |
| Author | Bernd Frick |
| Published date | 01 July 2007 |
THE FOOTBALL PLAYERS’ LABOR
MARKET: EMPIRICAL EVIDENCE FROM
THE MAJOR EUROPEAN LEAGUES
Bernd Frick
n
Abstract
The growing economic importance of professional football and the recent
fundamental changes in the regulatory regime governing the football players’
labor market together with the availability of detailed information on
player salaries, transfer fees and contract lengths have convinced an increasing
number of economists from all over Europe to devote their attention to the
operation of that particular market. The following paper reviews the available
evidence on the various dimensions of that market (remuneration, transfers,
contracts and mobility) and points out some promising directions for further
research.
I Intro ductio n
European football is unquestionably the world’s most popular sport (Matheson,
2003). Apart from Europe it is the national sport of most of the countries in
Latin America and Africa. Even in Asia, football is catching up rapidly. Not
surprisingly, therefore, the market values (measured, e.g., in terms of aggregated
individual transfer values of the players under contract) of the largest football
clubs in Europe are close to those of the most valuable sports franchises in the
United States.
1
It appears from Table 1 that average team values vary between 55 and 116
million hwith the most expensive teams (FC Chelsea London, Real Madrid, FC
The title by no means suggests that this paper is comparable with Rottenberg’s (1956) path-
breaking analysis. It is, however, thought to honor his achievements (for a discussion see also
Sloane, 2006 as well as Siegfried and Sanderson, 2006) as well as the works of Peter Sloane
(1969, 1971) who was the first European economist to direct our attention to professional
football.
n
Department of Management, University of Paderborn
1
Compare, for example, the figures presented in Deloitte and Touche’s ‘Football Money
League’ (formerly known as the ‘Annual Rich List’) including the top 20 European football
clubs and the information provided by ‘Forbes’ (until 1998 by ‘Financial World’) on the
valuation of professional sports teams in the United States.
Scottish Journal of Political Economy, Vol. 54, No. 3, July 2007
r2007 The Author
Journal compilation r2007 Scottish Economic Society. Published by Blackwell Publishing Ltd,
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422
Barcelona) reaching levels far beyond h300 million each.
2,3
At the same time,
however, each of the five leagues under consideration also includes a number of
small teams that sometimes not even reach two-digit figures (such as FC Nancy
in France and FC Cadiz in Spain).
4
As, in Europe, access to the first division in
professional football depends mainly on sporting performance – and not on the
size of the market – the variance in team values is considerably higher than in
the US Major Leagues, where franchise rights tend to be sold to investors from
large metropolitan areas only. Irrespective of these differences individual player
salaries and endorsement contracts for football celebrities are now at par with
Table 1
Market values of first division teams in the ‘Big 5’ European leagues 2005/2006–2006/2007 (in
h
1,000)
Country Season
Aggregated
transfer value
Average
transfer value
per team Minimum Maximum
England 2005/06 2,257,600 112,880 36,550
FC Sunderland
366,075
FC Chelsea
2006/07 2,327,050 116,353 20,800
Watford FC
404,775
FC Chelsea
Italy 2005/06 1,726,635 86,332 17,300
Ascoli Calcio
319,500
Juventus Turin
a
2006/07 1,438,420 71,921 14,000
Ascoli Calcio
271,050
Inter Milano
Spain 2005/06 1,653,905 82,695 3,400
FC Cadiz
328,250
Real Madrid
2006/07 1,938,475 96,924 19,225
Gim. de Taragona
355,850
FC Barcelona
Germany 2005/06 1,127,550 62,642 21,800
MSV Duisburg
192,725
Bayern Munich
2006/07 1,186,075 65,915 16,750
Energie Cottbus
182,150
Bayern Munich
France 2005/06 1,083,175 54,159 8,100
FC Nancy
156,375
Olympique Lyon
2006/07 1,100,000 54,991 12,275
AFC Valenciennes
166,425
Olympique Lyon
Notes:
a
Relegated at the end of the 2005/2006 season due to involvement in a league-wide bribery scandal.
Source: http://www.transfermarkt.de
2
The Turkish ‘Su
¨per Lig’ is number six in terms of the aggregated market value of its teams.
Their value, however, is less than half of that of the French teams. In terms of sporting
performance in the Champions League and in the UEFA-Cup, the Portuguese league is ranked
on sixth place in Europe. During the last 5 years the Portuguese teams have only been slightly
less successful than the German clubs (for the development of the 5-year-moving average of
club performances see UEFA 2006).
3
Average roster size of first division football teams is about 25.
4
It is no accident that the names of the ‘poor teams’ change while those of the ‘rich teams’
remain the same: Given the close relationship between market values and sporting performance,
the poor teams are very likely to be relegated at the end of the season.
THE FOOTBALL PLAYERS’ LABOR MARKET 423
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Journal compilation r2007 Scottish Economic Society
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