The 50plus1-rule in German football is a controversially discussed institutional change that regulates investment behavior of professional football teams. This paper provides an empirical analysis of its effects. We gathered panel data on 47 teams in the German Major League Football (“Erste Bundesliga”) from the seasons 1989/90 until 2018/19. This paper applies a difference-in-difference approach to examine investment behavior in budgets as well as sporting success between impacted competitors and those exempted from the rule. Our results do not suggest any equalizing properties of the regulation. By contrast, we find anticompetitive effects and distorting properties of the regulation.
AceroI., SerranoR., & DimitropoulosP. (2017). Ownership structure and financial performance in European football. Corporate Governance: The International Journal of Business in Society, 17(3), 511–523.
2.
AhtiainenS., & JarvaH. (2022). Has UEFA's financial fair play regulation increased football clubs’ proftability?European Sport Management Quarterly, 22(4), 569–587.
3.
AlabiM., & UrquhartA. (2023). The financial impact of financial fair play regulation: Evidence from the English Premier League. International Review of Financial Analysis, 92, 103088.
4.
AndrefW. (2007). French football: A financial crisis rooted in weak governance. Journal of Sports Economics, 8(6), 652–661.
5.
BauersS., LammertJ., FaixA., & HovemannG. (2020). Club members in German professional football and their attitude towards the ‘50+1 Rule’: A stakeholder-oriented analysis. Soccer & Society, 21(3), 274–288.
6.
BauersS., LammertJ., & HovemannG. (2015). Beherrschender einfluss von investoren im Deutschen proffußball: Eine bestand-saufnahme und analyse bestehender umgehungen der 50+1-Regel. Sciamus Sport und Management, 3, 1–17.
7.
BrüggemannT. (2018). Was besagt die 50+1-Regel genau? Wo ist sie festgehalten?Der Hintergrund zur Diskussion. https://www.kicker.de/679442/artikel
8.
BudzinskiO. (2014). The competition economics of financial fair play. In BudzinskiO. & FeddersenA. (Eds.), Contemporary research in sports economics: Proceedings of the 5th ESEA Conference (pp. 77–98). Lang.
9.
BudzinskiO. (2018). Financial regulation as an anticompetitive institution. In BreuerM. & ForrestD. (Eds.), The Palgrave handbook on the economics of manipulation in sport (pp. 159–179). Springer International Publishing.
10.
BudzinskiO., GaenssleS., & Kunz-KaltenhäuserP. (2019). How does online streaming Affect antitrust remedies to centralized marketing? The case of European football broadcasting rights. International Journal of Sport Finance, 14(3), 147–157.
CaglioA., LafftteS., MasciandaroD., & OttavianoG. I. (2023). Has financial fair play changed European football?Sport Economic Review, 3(1), 1–14.
14.
CameronA. C., GelbachJ. B., & MillerD. L. (2008). Bootstrap-based improvements for inference with clustered errors. The Review of Economics and Statistics, 3(90), 414–427.
15.
DepkenC. A. (2016). Fan loyalty in professional sports. Journal of Sports Economics, 2(3), 275–284.
DietlH., LangM., & WernerS. (2010). The effect of luxury taxes on competitive balance, club profits, and social welfare in sports leagues. International Journal of Sport Finance, 5(1), 41–51.
20.
DietlH. M., & FranckE. (2007). Governance failure and financial crisis in German football. Journal of Sports Economics, 8(6), 662–669.
21.
DietlH. M., FranckE., & LangM. (2008). Overinvestment in team sports leagues: A contest theory model. Scottish Journal of Political Economy, 55(3), 353–368.
22.
DietlH. M., FranckE., LangM., & RathkeA. (2012). Salary cap regulation in professional team sports. Contemporary Economic Policy, 30(3), 307–319.
23.
DietlH. M., LangM., & RathkeA. (2011). The combined effect of salary restrictions and revenue sharing in sports leagues. Eco-nomic Inquiry, 49(2), 447–463.
24.
DrutB., & RaballandG. (2012). Why does financial regulation matter for European professional football clubs?International Journal of Sport Management and Marketing, 11(1/2), 73–88.
25.
EndoM. G., FlorioK. M., GerberJ. B., & SommersP. M. (2003). Does a salary cap improve competitive balance?Atlantic Economic Journal, 31(4), 388.
26.
ForrestD., & SimmonsR. (2002). Team salaries and playing success in sports: A comparative perspective. In AlbachH. & FrickB. (Eds.), ZfB: Ergänzungshefe: Vol 4 Sportökonomie (Vol. 2, pp. 221–238). Gabler Verlag.
27.
FortR., & QuirkJ. (1995). Cross-subsidization, incentives, and outcomes in professional team sports leagues. Journal of Economic Literature, 33(3), 1265–1299.
28.
FranckE. (2014). Financial fair play in European Club Football: What is it all about?International Journal of Sport Finance, 9(3), 193–217.
29.
FranckE. (2016). Comment A. on the newly revised “2015 version” of the UEFA Club Licensing and Financial Fair Play Regulations. Working Papers362, University of Zurich, Department of Business Administration (IBW).
30.
FranckE., & NüeschS. (2011). The effect of wage dispersion on team outcome and the way team outcome is produced. Applied Economics, 43(23), 3037–3049.
31.
FrickB. (2005). ‘und geld schießt eben doch tore’: Die voraussetzungen sportlichen und wirtschaflichen erfolges in der Fußball-Bundesliga. Sportwissenschaf, 35(3), 250–270.
32.
Garcia‐del‐BarrioP., & AgneseP. (2023). To comply or not to comply? How a UEFA wage‐to‐revenue requirement might affect the sport and managerial performance of soccer clubs. Managerial and Decision Economics, 44(2), 767–786.
33.
KésenneS. (2003). The salary cap proposal of the G‐14 in European football. European Sport Management Quarterly, 3(2), 120–128.
34.
KésenneS. (2000). The impact of salary caps in professional team sports. Scottish Journal of Political Economy, 47(4), 422–430.
35.
LarsenA., FennA. J., & SpennerE. L. (2006). The impact of free agency and the salary cap on competitive balance in the National Football League. Journal of Sports Economics, 7(4), 374–390.
36.
LeachS., & SzymanskiS. (2015). Making money out of football. Scottish Journal of Political Economy, 62(1), 25–50.
37.
MarequeM., BarajasA., & Lopez-CorralesF. (2018). The impact of union of European Football Associations (UEFA) financial fair play regulation on audit fees: Evidence from Spanish Football. International Journal of Financial Studies, 6(4), 92.
38.
MaxcyJ. (2014). The American view on financial fair play. In BudzinskiO. & FeddersenA. (Eds.), Contemporary research in sports economics: Proceedings of the 5th ESEA Conference (pp. 57–73). Lang.
39.
PeetersT. (2011). Broadcast rights and competitive balance in European soccer. International Journal of Sport Finance, 6(1), 23–39.
40.
PeetersT., & SzymanskiS. (2014). Financial fair play: Winners and losers on and of the pitch. In BudzinskiO. & FeddersenA. (Eds.), Contemporary research in sports economics: Proceedings of the 5th ESEA Conference (pp. 17–33). Lang.
41.
PeetersT., & SzymanskiS. (2015). Financial fair play in European football. Economic Policy, 29(78), 343–390.
42.
PilzG. A. (2011). Zusammenfassung der einstellungen der faninitiativen und interessengemeinschafen der organisierten fußballfans zur 50+1 - regel und gutachterliche stellungnahme zu den einstellungen. Hannover.
43.
QuitzauJ. (2003). Die vergabe der fernsehrechte an der Fußball-Bundesliga: Wohlfahrtsökonomische, wettbewerbspolitische und sportökonomische aspekte der zentralvermarktung. Schrifen zur Wirtschaftstheorie und Wirtschaftspolitik: Vol 26Lang.
Rheinische Post. (2018). Lizenzspieleretat der Fußball-Bundesligisten in der saison 2013/2014
47.
RohdeM., & BreuerC. (2016). Europe's elite football: Financial growth, sporting success, transfer investment, and private majority investors. International Journal of Financial Studies, 4(2), 12.
48.
RohdeM., & BreuerC. (2017). The market for football club investors: A review of theory and empirical evidence from professional European football. European Sport Management Quarterly, 17(3), 265–289.
RubinD. B. (1986). Statistics and causal inference: Which ifs have causal answers. Journal of the American Statistical Association, 81(396), 961–962.
51.
SandersonA. R., & SiegfriedJ. J. (2003). Thinking about competitive balance. Journal of Sports Economics, 4(4), 255–279.
52.
SchubertM., & HamilS. (2018). Financial doping and financial fair play in European Club Football competitions. In BreuerM. & ForrestD. (Eds.), The Palgrave handbook on the economics of manipulation in sport (pp. 135–157). Springer International Publishing.
