Dietl, H; Grossmann, M; Trinkner, U (2008). The effect of marginal cost elasticity on competitive balance. Journal of Sports Economics, 9(4):339-350.
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This article presents a model of talent investments where two clubs compete for prizes. Our model is based on a general class of cost functions with a constant elasticity of marginal costs with respect to investments. The analysis finds that reduced revenue sharing improves competitive balance. Furthermore, we show that a higher elasticity of marginal costs with respect to investments enhances competitive balance and simultaneously reduces the negative effect of revenue sharing on competitive balance.
|Item Type:||Journal Article, refereed, original work|
|Communities & Collections:||03 Faculty of Economics > Department of Business Administration|
|Deposited On:||23 Jan 2009 16:19|
|Last Modified:||27 Nov 2013 21:53|
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