Is an exit fee a barrier to entry?

The big news out of the ACC is that Noitre Dame has been unanimously voted in as a member of the conference... in every sport but football (of course) and hockey.  The not-so-big news in the grand scheme of things is that the ACC voted 10-2 to increase its exit fee from $20 million to more than 2.5 times that amount: $50 million. One of those two naysayers was Maryland's president Wallace Loh.  Loh voted against the increased exit fee because it could be seen as a barrier to entry by some who may otherwise want to join the ACC […]

Harsh Punishments, but No Death Penalty, for Penn State

The NCAA has hit Penn State with harsh penalties as punishment for the Jerry Sandusky case.  Penn State is put on probation for 5 years, is banned from bowl games for 4, loses numerous scholarships, is fined $60 million, and has the dreaded "vacating wins" penalty imposed on it (for the period 1998-2011).  It's players are allowed to transfer without penalty, which is also a penalty for Penn State football because it makes it easier for players to leave. No doubt about it, these are harsh penalties, and they seem appropriate to me.   There's no death penalty because of […]

From Monopsony to Arbitration: Time to get Paid

♪♫I just got paid today, got me a pocket full of change♫♪ Last week saw the day by when arbitration-eligible players and their teams had to exchange final offers in Major League Baseball.  Baseball uses a variant of what is known as final offer arbitration, a type of arbitration (suggested by economist Carl Stevens in 1966) where the arbitrator renders a decision restricted to being one party's offer or the other's.   The word "final" is a misnomer in MLB since players and their teams may continue bargaining until a decision is rendered, so those offers really aren't final. One […]

If You Oppose Stadium Subsidies, then You Might Be a Deadbeat

Have you ever wondered about the demographics of people who oppose stadium subsidies?  Me neither, but here's something from Savethevikes.org, a stadium proponent website. As with any public hearing we do expect to hear from opposition on a Vikings stadium and given the time slot, the advantage goes to opponents. We typically see those who are unemployed or on a fixed income advocating against a new stadium because the government isn’t giving them enough. All while the majority of the Vikings 2.5 million fans are working. Well, at least the author didn't refer to us pencil-necked, pointy-headed professors - employed […]

What Makes a College Coach Overpaid?

From the Bleacher Report, we have a list of 20 coaches who are supposedly being paid too much. College football coaches make incredible amounts of money in today's football-obsessed society. Schools want wins and they want a lot of them. They want conference championships and national championships. And they're willing to pay for them. According to a study conducted by USA TODAY, at least two-dozen head coaches made more than $2 million in 2010. Doesn't that seem ridiculous? There is no doubt that these men work extremely hard in an excruciatingly competitive field, but many are overpaid. Here are the 20 most-overpaid […]

Football and University Priorities

At Northeastern, a private university in Boston, the college football model wasn't working very well.  Expenses averaged $3.5 million, and attendance was just 1,600 fans per game from a student body of over 20,000.  After a two year review of the athletic department, the decision was made to drop the sport.  Shira Springer describes the fallout in two articles in today's Boston Globe.  One focuses on the institution at large, the other on the players, many of whom transferred.  The negative fallout appears to be modest.  Those with ties to the program are understandably upset with the institution's change in priorities.  But as Springer […]

Season Ticket Prices and Minimum Donations at FBS Schools

Rivals has collected football season ticket prices and minimum donations at the 120 FBS schools for the 2010 season.  The donations work like NFL personal seat licenses.  Programs realize there is "money on the table" since some fans place a higher value on attendance at home games than what it costs to get season tickets.  So schools charge a fee to capture some of that value in order to generate maximum revenue. There's not a lot of surprising things in there, at least to this economist.  Ohio State tops the list with a minimum donation of $1,500 - you could […]

The Economic Impact of the Demise of the Big XII - Waco

A Waco economist, RayPerryman, has prepared an economic impact statement about the impact of the demise of the Big XII on Waco and Texas (via a commenter to another TSE post, Millsy): The report Perryman shared Thursday includes an estimated $714 million loss in annual expenditures in the state of Texas. Waco’s potential hit could reach $196.7 million annually. Those losses include tourism — money spent at restaurants, hotels, stores, gas stations, etc. — television revenue and other areas, he said. Additionally, Perryman projects the loss of 5,764 jobs statewide and 1,677 in the Waco area if Baylor is not […]

Does NFL Success Matter for Communities?

Maybe only steroid discussions stirs the blood of sports economists quite like questions about the impacts of sports on communities, largely because of the tie-in with debates over public funding for stadiums. Let me be very clear on a couple of points. 1) The quantitative work in economics by people such as the TSE's Brad Humphreys and Dennis Coates casts serious doubt on the supposed tax revenue and direct economic development benefits of sports stadiums beyond the imaginations of civic "boosters." 2) The existence of broader, indirect impacts on income, wages, or intangible enjoyment by some citizens do not provide […]

"Frustration and Temptation." A Q&A with Mizzou AD Mike Alden

This morning's Columbia Daily Tribune has a very interesting interview between the Trib's Joe Walljasper and University of Missouri athletic director Mike Alden. Mr. Alden discusses in detail many of the issues surrounding the Big 10's public announcement that it will consider expansion and the fact that Mizzou is frequently mentioned as a potential new member. Read the whole thing, but one thing that caught my eye was this passage a little over halfway down in which Alden discusses the club theory I blogged about on Tuesday (here). Q: You mentioned the difference of $12 million in TV football revenue […]

No Country for Old Men: The Bowden Saga

Due to travels, I missed writing about the Bobby Bowden affair during the height of the storm. The dismay among FSU fans is strong. In an Orlando Sentinel blog poll, 42% thought it time for Bowden to go -- although a minority and not necessarily a good indicator of the precise number of such fans, it is still a fairly strong signal of the uneasiness with the situation. The topic of age and coaching performance fits into the realm of an article by my former colleague, Tom Wisley and myself, on Is There a Managerial Life Cycle?. Using NFL data […]

More March Madness!

Remember the good old days when there were only two postseason men's college basketball tournaments? Things were simple then. If your bubble popped, you either landed in the postseason NIT, or you went home, licked your wounds and dreamed of next year. Things got a bit messier last year, with the debut of the College Basketball Invitational (CBI), a 16 team tournament sponsored by a sports marketing company that tried to steal a few teams from the NIT. I had a post about the CBI last year. The CBI is back again this year, although the games will be televised […]