Header

UZH-Logo

Maintenance Infos

A teoretical analysis of the influence of money injections on risk taking in Football Clubs


Franck, E; Lang, Markus (2013). A teoretical analysis of the influence of money injections on risk taking in Football Clubs. Working Paper Series 160, University of Zurich. Institute for Strategy and Business Economics.

Abstract

This paper analyzes the adverse incentive effects produced by money injections of benefactors (sugar daddies SD). We show that the existence of a SD induces the club to choose a riskier investment strategy and the more the SD commits to bailout the club, the more the clubs’ optimal level of riskiness increases. Moreover, a private SD bails out the club less often than a public SD. Our model further shows that a ”too-big-to-fail” phenomenon exists because it is optimal to always bailout a club if its market size is sufficiently large.

Abstract

This paper analyzes the adverse incentive effects produced by money injections of benefactors (sugar daddies SD). We show that the existence of a SD induces the club to choose a riskier investment strategy and the more the SD commits to bailout the club, the more the clubs’ optimal level of riskiness increases. Moreover, a private SD bails out the club less often than a public SD. Our model further shows that a ”too-big-to-fail” phenomenon exists because it is optimal to always bailout a club if its market size is sufficiently large.

Statistics

Downloads

13 downloads since deposited on 10 Sep 2019
13 downloads since 12 months
Detailed statistics

Additional indexing

Item Type:Working Paper
Communities & Collections:03 Faculty of Economics > Department of Business Administration
Dewey Decimal Classification:330 Economics
Language:English
Date:30 March 2013
Deposited On:10 Sep 2019 14:05
Last Modified:25 Sep 2019 00:45
Series Name:Working Paper Series
Number of Pages:30
ISSN:1660-1157
OA Status:Green
Other Identification Number:merlin-id:18201

Download

Green Open Access

Download PDF  'A teoretical analysis of the influence of money injections on risk taking in Football Clubs'.
Preview
Filetype: PDF
Size: 616kB