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Similar Economic Histories, Different Industrial Structures: Transatlantic Contrasts in the Evolution of Professional Sports Leagues

Published online by Cambridge University Press:  22 November 2005

LOUIS P. CAIN  and
DAVID D. HADDOCK
LOUIS P. CAIN
Affiliation:
Professor of Economics at Loyola University Chicago, Adjunct Professor of Economics at Northwestern University, and Visiting Professor of Economics at the University of Chicago Graduate School of Business. E-mail: lcain@luc.edu.
DAVID D. HADDOCK
Affiliation:
Professor of Law and Economics at Northwestern University, and Senior Fellow at PERC. E-mail: dhaddock@northwestern.edu.
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Abstract

Industries that have different structures in Europe than in America can teach useful lessons about industrial evolution. Despite similar initial histories, European professional sports leagues adopted team promotion and relegation, which facilitates much easier entry than is possible in North America, where leagues themselves create new franchises to sell to investors. By contrasting the histories of the English Football League and the National Baseball League, we show that their structures arose from differences in geographic compactness, the entertainment level of games, and territorial monopolies. As the evolution becomes more understandable, the persistence of the intercontinental difference becomes more problematic.

Type
ARTICLES
Information
The Journal of Economic History , Volume 65 , Issue 4 , December 2005 , pp. 1116 - 1147
Copyright
© 2005 The Economic History Association

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