Testing for Competitive Balance

15 Pages Posted: 5 Apr 2014 Last revised: 29 Jun 2016

See all articles by Lee VanScyoc

Lee VanScyoc

University of Wisconsin - Oshkosh - Department of Economics

M. Kevin McGee

University of Wisconsin - Oshkosh

Date Written: January 5, 2015

Abstract

We present two tests for the hypothesis that a league is competitively bal- anced, identifying in each case the appropriate statistic as well as its sampling distribution. We then apply these tests to Major League Baseball and the National Football League. We demonstrate how these tests can be applied to full sports leagues, or to just intradivisional play, and to both single season and multiple season outcomes.

We also show how one of our statistics is related to existing measures of competitive balance, and note the possibility that that, because our statistics have known sampling distributions, that knowledge may ultimately allow them to be transformed into measures that are comparable between leagues of different sizes and season lengths.

Keywords: Sports, Sampling

JEL Classification: C46, L83

Suggested Citation

VanScyoc, Lee and McGee, M. Kevin, Testing for Competitive Balance (January 5, 2015). Available at SSRN: https://ssrn.com/abstract=2420434 or http://dx.doi.org/10.2139/ssrn.2420434

Lee VanScyoc

University of Wisconsin - Oshkosh - Department of Economics ( email )

800 Algoma Blvd.
Oshkosh, WI 54901
United States

M. Kevin McGee (Contact Author)

University of Wisconsin - Oshkosh ( email )

800 Algoma Blvd
Oshkosh, WI WI 54901
United States

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