Font Size: a A A

An Industry Organizational Analysis Of Professional Sports Leagues

Posted on:2006-10-02Degree:DoctorType:Dissertation
Country:ChinaCandidate:L WangFull Text:PDF
GTID:1117360218463082Subject:Humanities and sociology
Abstract/Summary:PDF Full Text Request
Making a comprehensive survey of the more than 100 years'development course of professional sports industry in western countries, we discover one thing in common in their success: the professional sports league, which is an institutional arrangement developed during the growth course of professional sports in these countries. Utilizing the theories on industry organization, the nature, the running and the effect of this system is discussed. On the basis of the knowledge to industry economics,it is believed that professional sports industry refers to the collection of franchises who provides products of athletic competitions and performances of the same sports event. Its nature rests with manufacturing and providing competition performances in order to meet the requirement of the market (spectators). This nature determines that the process of production requires all franchises to work cooperatively yet at the same time to maintain their independent status of a legal body corporate respectively. The uncertainty of outcome is the significant element that determines the quality of the competitions. While the injustice distribution of resources may cause the unfairness of competition results. These distinguishing features decide that the production of professional sports should be carried out through the way of sports leagues.Professional sports leagues are intermediate organizations established by several franchises who bear the risks and share the revenues together, for the sake of living and on the basis of contracts. They are kind of a resource distribution system between the market and enterprises, belonging to intermediate organizations that possess the characteristics of both market and enterprises. Through the investigations of the centralization and entrance barrier of professional sports market in America, we believe that its structure belongs to the complete monopolizing pattern, which to a great extent could fulfill the peculiarity of the manufacturing process of professional sports products and therefore is quite reasonable. As the seller monopoly organization, the professional sports league dominates the output on the products marketplace and fixes the price of trade and yield with the purpose to maximize the profits. Moreover, by means of sharing the profits, the finance equilibrium of every franchise and the steady development of the whole league are guaranteed. As the buying monopoly organization, the league controls its input on the resource marketplace to reduce the operating cost of the franchises. Furthermore, through draft and salary cap, the league coordinates the distribution of the players and avoids excessive competition among franchises. In the following we use indexes such as the degree of competition balancing,the audiences,the revenue and the value of the franchises to reflect the effectiveness of resource distribution and marketing. According to investigations, presently, the four main professional leagues of America are highly balanced in competition. The number of audiences, the operating revenue of the franchises and their value are increasing rapidly, showing that the American professional sports leagues are achieving excellent accomplishment on the market. The market structure, the operation and accomplishment on the market interact and influence one another. Among the three, the operation is mainly influenced by the structure and the accomplishment is mainly influenced by the operation. Therefore, to ensure the healthy development of professional sports, it is a key point to establish a well-structured sports market. The development of professional sports leagues in western countries accumulated abundant experiences for the innovation of professional sports systems. Currently, there is no real professional sports league administration system in China,which causes a number of problems, including excessive competition in the sports market, the domination of national ownership among sports franchises and low effectiveness in operation. Hence, it is imperative to reform the sports system further and establish a professional sports league in accordance with the regulation of market economy and the nature of professional sports.
Keywords/Search Tags:Professional sports leagues, Industry organization, Club
PDF Full Text Request
Related items