The Decline of Professional Football in Italy

23 Pages Posted: 1 Dec 2012

See all articles by Tito Boeri

Tito Boeri

Bocconi University - Department of Economics; Centre for Economic Policy Research (CEPR); IZA Institute of Labor Economics

Battista Severgnini

Copenhagen Business School - Department of Economics

Abstract

There are three main critical areas in the Italian football industry. First, we find that the revenues of teams playing in Serie A are low and highly concentrated on TV rights, hence vulnerable to changing conditions in the mass media industry. Second, we document that there has been an exponential growth of players' salaries, which has been historically driving up the total costs up to unsustainable levels. The third problem relates to a lack of credibility of the competition, due to a long list of scandals and its potential effects on revenues. In particular, the 2006 investigation on match rigging, and the new episodes on betting scandals in 2009 and 2010, have depressed the total revenues of all teams not only of those directly involved in match fixing. There can also be second round effects via a deterioration of the quality of games, which may also reduce revenues of the clubs. Possible ways out of these problems are discussed in the last section.

Keywords: superstar effects, match fixing, career concerns

JEL Classification: J24, J44

Suggested Citation

Boeri, Tito and Severgnini, Battista, The Decline of Professional Football in Italy. IZA Discussion Paper No. 7018, Available at SSRN: https://ssrn.com/abstract=2183551

Tito Boeri (Contact Author)

Bocconi University - Department of Economics ( email )

Via Gobbi 5
Milan, 20136
Italy

Centre for Economic Policy Research (CEPR) ( email )

London
United Kingdom

IZA Institute of Labor Economics ( email )

P.O. Box 7240
Bonn, D-53072
Germany

Battista Severgnini

Copenhagen Business School - Department of Economics ( email )

Porcelænshaven 16 A, 1
Frederiksberg C, DK-2000
Denmark

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