Competition and labor market strategy in European club soccer
Pifer, Nathan David
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European soccer has benefited from increased financial growth over the past couple of decades as live broadcasting rights at the domestic and continental levels, exorbitant commercial deals, and the enduring popularity of the sport have injected large sums of money into the industry. However, concerns have arisen over the apparent income and spending gaps that have formed between clubs. Such gaps are problematic in the open-style leagues of European soccer where owners must strive for win-maximization or else risk succumbing to the pitfalls of relegation. Building upon the relationship between player expenditures and team success that has been established in prior research, this study extended the focus to the specific strategies that clubs of all income levels can employ in order to perform efficiently and effectively in their respective leagues. Using over fifteen seasons (2000-01 to 2015-16) of data from the three most profitable European soccer leagues (the English Premier League, Bundesliga, and La Liga), the author conducted a diverse series of empirical analyses to assess which labor market behaviors and variables were the most conducive to team success. Along the way, the level of competitiveness in each of the three leagues was examined, and elements of the Resource-Based View of the Firm (RBV) were incorporated to help explain some of the observed phenomena.