Harvard Journal of Sports and Entertainment Law, Vol. 6, 2014
44 Pages Posted: 23 Jul 2013 Last revised: 29 Jul 2015
Date Written: February 18, 2014
For which team should basketball superstar LeBron James play? Where should celebrity statistician Nate Silver ply his craft of predictive wizardry? On which network should Jon Stewart flash his mordant wit?
For some reason, the answers to these disparate questions are only indirectly related to the desires of third-party fans. Indeed, it’s a puzzle that fans don’t already have more influence on the recruitment or retention of their sports or entertainment heroes (“talent”).
This paper proposes the development of Fan Action Committees (“FACs”), which, like their political counterpart (PACs), could mobilize and empower fans to play a larger role in the decision-making associated with which “production teams” the talent will work. We outline two institutional options: FACs could directly compensate talent by crowdfunding, or they could make donations to charities favored by talent. We then discuss both obstacles and objections from a variety of policy and legal perspectives ranging from competitive balance to distributive justice. Finally, we consider possible extensions of the FAC model as well as offer some ruminations on why FACs haven’t already developed.
Importantly, FACs create the potential for more efficient valuations of talent by registering not only the number of fans but also the intensity of their preferences. This insight, which stresses the upside of price discrimination, has relevance for a wide range of human endeavor where bilateral contracts have third party externalities that are not currently calibrated or adequately valued.
Keywords: contracts, public policy, externalities
Suggested Citation: Suggested Citation