By Stephen Brosnan

In their popular book ‘Soccereconomics’, Simon Kuper and Stefan Szymanski find spending on players’ wages is a better predictor of football clubs league position than net spending on transfers. In this post I explore whether findings from the Global Sports Salaries Survey 2018 support these findings. Table 1 shows the top 11 clubs ranked by average earnings by players.

The findings in Table 1 certainly support the findings of Kuper and Szymanski with many of the heavyweights that have dominated European football over the last 20 years featuring. For example, the clubs featured have won 16 of the previous 20 Champions Leagues (and 9 of the last 10). Under fire Manchester United manager Jose Mourinho will be quick to point out he masterminded two of the exceptions, Porto (2004) and Inter Milan (2010) while the AC Milan claimed the other wins in 2003 and 2007.

The Premier League is the most represented league in the top 11 with five teams. The five teams included have won every Premier League since it’s inception in 1992 with the exception of two years (Blackburn 1995 and Leicester 2016). Barcelona and Real Madrid occupy the top two overall spots in the rankings. They are joined by Atletico Madrid who rank 6th (in soccer teams) and 17th overall in terms of average spending on player’s salaries. These teams have dominated the Spanish domestic league, winning every La Liga since 2005.
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Juventus, the third highest ranked soccer team and ninth team overall, have dominated Serie A over the last decade. The Old Lady has won seven Serie A titles in a row including four consecutive doubles (Serie A and Coppa Italia). In Germany, Bayern Munich have won six Bundesliga titles in a row and 14 of the previous 20. Furthermore, since Qatar Investments purchased PSG in 2011, and made them the richest ( and highest spending) club in France, they have won five of the last seven Ligue 1 titles.

By Robbie Butler,

On the 14th of November I wrote about the 2018 MLS season, and the rise of Atlanta United. The piece was in the context of competitive balance in Major League Soccer, and the fact that 12 franchises had won the US title, making it more competitive than any major European league over the past 23 years.

We can make that 13. Atlanta United were crowned MLS Champions on Saturday evening at around 10pm EST.

The remarkable thing about the "The Five Stripes" is that they are playing in just their second season of the Eastern Conference. In total the franchise has played under 80 games in its entire existence, yet is now the number 1 US football team.To put this into context, it is great to compare the closed system in the US, to the oldest set of interconnected leagues in the world in England.

It is difficult to know how many tiers there are in England (there could be up to 22) but it is safe to assume that there are at least 8 interconnected divisions. These range from regional leagues at the lower end, to the Premier League at the top, and are list below. 

Assuming Atlanta United were an English club, and had won promotion in Years 1 and 2 of their existence, the club would be heading into the National League South (given Atlanta's location in the US we will assume South rather than North). From a starting point in this league, it would take a minimum of 6 seasons before the club could even challenge for the Premier League title.

​The current dominance of the big six clubs in England's means they have little to fear from the remaining Premier League clubs (Leicester City may obviously disagree), never mind clubs in the lower tiers of English football. The rise of Atalanta United is not something you can expect to be replicated in England anytime soon, if ever. 

Just another example of how the structure of the same sport on either size of the Atlantic is different, and can result in very different outcomes.  

By John Considine

The Shawshank Redemption seems to feature regularly amongst the favourite movies of sports people.  The story of a person overcoming the odds that seem unfairly stacked is the theme of many a sports book (it can even feature in economics books as a previous blog post on this site demonstrated).

When it comes to sports betting it seems sports fans also seek to overcome the odds.  A recent article in European Sport Management Quarterly warns fans/supporters against betting on their favourite team.  The article is written by Sangwon Na, Yiran Su, and Thilo Kunkel.  Their bottom line is that fans lose money when betting on their favourite team.  Using data from betting on the German Bundesliga the authors test for the extent of fans' "errors" or "biases".  One set of their results is reproduced in the picture below.

Citing previous literature, the authors note that "highly identified fans exhibit greater bias in their evaluation of their teams than fans with lower team identification".  The words "bias" and "evaluation" suggest errors.  However, there are other perspectives.  One could say that that more committed supporters spend more money on their team in the betting shop.  Viewing the bet as a consumption decision rather than an investment decision should be considered.  More committed supporters probably also spend more buying replica kit in the club shop.  Should we warn supporters against buying replica kit?

The title of the article is "Do not bet on your favourite team ...".  The literature cited within is impressively broad.  Of particular interest are some of the frameworks and concepts more frequently used in psychology and sociology.  One of the articles cited examines fans' predictions regarding their team and the remaining 15 NFL teams.  The data in this paper by Cade Massey, Joseph Simmons and David Armor did not require the fans to wager their money.  Instead prizes were offered for predictions.  The predictions from this paper are reproduced in the picture below.

It is clear that the fans appreciate that for every winner there is a loser.  But there is a clear bias when it comes to their favourite teams.  The authors call it optimism.  But is it?  It is not the case that sports fans always look on the bright side of things.  NFL fans may have optimism when it comes to the likelihood of success but they also tend to believe that the odds are stacked against their team.  This was illustrated by a 2016 article by Shai Davidai and Thomas Gilovich.

Davidai and Gilovich examined the perspective of NFL fans when the schedule for the season was released.  How did the fans perceive the schedule for their team?  Was the schedule favourable (tailwind) or was it unfavourable (headwind)?  Twice as many fans saw the schedule as unfavourable as illustrated in the picture below. 

The above picture is hardly a representation of optimism.  However, it does feed into a narrative of having to overcome the odds to succeed.  Fans overestimate both the difficulties of the task and the chances of success.  A strange combination.  Unless one is constructing a heroic story.

By Stephen Brosnan

Last week the latest edition of the Global Sports Salaries Survey (GSSS) was released by Sporting Intelligence (available here). The GSSS provides a breakdown of sports clubs average spending on players’ salaries globally. Table 1 shows the top 10 clubs globally by average annual spend on player’s salaries. It should be noted that these figures are based on basic pay and do not include performance based bonus’, loyalty bonus’ and endorsements. 

Table 1 shows the top 10 spenders by players average wages are composed of six basketball teams and four soccer teams. Barcelona have gained the number one spot at the expense of the Oklahoma City Thunder (OKC) who drop to third in terms of average earnings per player. Barcelona have become the first club since the introduction of the GSSS nine years ago to pay their players over £10 million a year on average (£201,043 a week on average). The Catalan club’s wage bill increased this year with the signings of Phillipe Coutinho, Arthur, Malcolm and Arturo Vidal. Also, Leo Messi signed a contract extension which pays the talisman in excess of £50 million per year. 

The 3rd to 8th positions in Table 1 are held by teams from the NBA. OKC have the highest paid players on average with both Russell Westbrook and Paul George both earning NBA max contracts. In 2017, Westbrook signed a five year $205 million with George signing a four year $137 million contract the following year. The Thunder have slipped in the rankings after releasing ten time NBA All Star Carmelo Anthony from his $28 million a year deal.

Last seasons, NBA Champions Golden State Warriors are fourth on the list as a result of the earnings of their four NBA All-stars: Kevin Durant, Steph Curry, Klay Thompson and Draymond Green. In 2017, Steph Curry became the highest paid player in the NBA at the time signing a five-year $201 million contract. Current NBA finals MVP, Kevin Durant has actually taken a pay cut in order to facilitate paying the other stars and back up players. However, three of the Warrior’s star players: Durant, Thompson and Green are on expiring contracts and the team are faced with difficult decision given the NBA’s salary cap will make it impossible the pay the three players the kind of salary they could earn at other teams. 
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The highest climbers in the Top 10 are Juventus who have climbed from 32nd place in 2017 to 9th in 2018. The signing of five time Ballon D’Or winner Cristiano Ronaldo coupled with Douglas Costa and Leonardo Bonucci on big contracts have contributed to the sharp rise in average salaries at the Turin based club. Manchester United are the only Premier League team to feature in the top 10 with average annual salaries of £6.5 million. Manchester City (£5.93 million) are the next highest English club in 20th, with Chelsea (35), Liverpool (38) and Arsenal (39) all appearing in the top 40.

By Robbie Butler

Yesterday, Liverpool secured a dramatic last minute win in the Merseyside Derby to bring them back to within two points of Manchester City. As a fan of the Reds I was delighted at the end of the game, albeit in highly unusually circumstances. As is commonplace, once the final whistle sounded the league table almost immediately appeared on our screens. Liverpool, highlighted in blue, stood in second on 36 points from 14 games.

This got me thinking. Had any team in the Premier League era amassed 11 wins and 3 draws from their first 14, yet still find themselves second!?

The answer is no. 

Thanks to friends in OPTA, the data below can demonstrate just how hot the race for the league is this year. It will be very interesting to calculate competitive balance for the 2018/19 season, come May of next year.  

The first table demonstrates just how strong the top of the table is this season. Quite remarkably, Manchester City are two points worse off when compared to 2017/18. 

Newcastle United are a notable inclusion on the list, during the 1995/96 season, and are the only team not to go on and win the league having accumulated 35 points or more from 14 games. This record will have to fall this year, as either City or Liverpool, or maybe both, fail to win the league having reached 36 and 38 points respectively from 14 games.

The second table lists the seasons since 1992/93, 19 in total, where Liverpool would be top at this stage. The column on the right shows the number of points clear the Reds would be. On two occasions, they would be 9 points clear. One of these is compared to the Liverpool team of Gerard Houllier. On a further three occasions the Merseyside club would now be 8 points clear at the top. 

There certainly is a long way to go until next May but the pace that City and Liverpool are setting, and the evidence from past seasons, suggests the Premier League is a sprint more than a marathon. Exciting times lie ahead. 

by Declan Jordan

Earlier this week David Butler posted on the English FA's proposal to limit the number of non-homegrown players in senior squads, a move that has not gone down too well with the Premier League. I agree that the proposal may damage the quality of the Premier League. The justification reminds me of Brexiteers blaming UK economic problems on immigrants, when in reality, just as it is with the Premier League, immigrants are the potential solution to economic issues rather than the cause of them.

There is recent evidence however on the impact of foreign players on club performance in a recent paper in the Journal of Sports Economics (requires subscription). A colleague, Vicente Royuela, and his co-author Roberto Gasquez, from the University of Barcelona examined the influence of foreign players on the success of football clubs.

Using data from 971 clubs across the top-tier of 71 leagues, the paper shows that clubs in leagues with a higher proprtion of foreign players tend to perform better than clubs in leagues with less foreign players. However, within a league, having more foreign players does not have a significant effect on a club's performance.

This has implications for the FA's new policy on caps on foreign players. Fewer foreign players will negatively affect the quality of the clubs in the Premier League, damaging the 'product'. This indicates why the Premier League would oppose the move. At the same time, the relative performance of clubs with the Premier League will be unaffected. The most important determinant of within-league performance according to the authors is a club's wealth.

This suggests that those clubs that can afford to sign better quality foreign players will still be relatively better able to sign them. It highlights of course that the most important part of performance is not from where players come, but how good they are.

By Robbie Butler

Sunday the 16th of August 1992 is somewhat synonymous in the history of English football. It was on that day at 4pm that the top division (re-branded as the Premiership) went behind a pay-wall. Thus Sky Sports Football was born. The rest is history.

From the start of the 2019/20 season 200 live games will be broadcast across three subscription channels; Sky Sports, BT Sport and Amazon's UK Prime Video. These games will be shown at times generally between Friday evening and Monday night.

It is safe to say, the movement from free-to-air to subscription television has been a huge success for the broadcasters, clubs and players. While ardent football fans could probably tell you Teddy Sheringham scored for Nottingham Forrest on that day in August 1992, in a 1-0 win over Liverpool, most GAA fans would probably not know the equivalent day in their sport.

From the first television broadcast of a GAA match in 1962 until 2010, all games were available on free-to-air television in this country. But as all fans of Ireland's indigenous game now know, some of the content can only be viewed on subscription television.

This changed (I believe) on Saturday the 6th of February 2010. At 7.30pm that evening Meath lined out against Armagh in the National Football League in Navan, with the game only available to television viewers on subscription channel Setanta Sports 1. What has happened since has not been as dramatic as the shift in football but rather a slow movement towards subscription coverage. In 2014, Sky Sports joined the party and has since screened 20 live games each summer, 6 of which are exclusive. This will continue until at least 2022.

And what then?

In February 2016, the then director-general of the GAA Páraic Duffy wrote in his annual report to Congress:
“Any restriction that prohibits the GAA from engaging with all interested parties, including subscription TV providers, would seriously reduce our negotiating power and thus our ability to achieve the true worth of our assets, and would inevitably lead to a greatly reduced media-rights income. In what is already a small pool of potential broadcast partners, we must ensure the existence of a genuine market for our games and maintain the option of engaging with all interested parties, regardless of whether they are free-to-air or subscription providers. This flexibility and freedom is crucial if we are to nurture a competitive tender process and thus ensure that the GAA achieves the proper value for its rights."

The Irish Statute Book ensures that all four All-Ireland Finals must be shown free-to-air. Everything else, as things currently stand, is up for grabs. The Munster Hurling Championship; the Super 8s; all eight semi-finals. While we are unlikely to see the dramatic shift that has occurred in football in England, it is reasonable to suggest that the six Championship games currently exclusive to Sky Sports will grow. And this is before National League games are included. You have been warned.

 By David Butler

Last week the Premier League released a statement on Brexit and access to talent in light of the FA's proposal seeking to limit the number of non-homegrown players in senior squads. Media accounts suggest that the FA are aiming for the number of non-homegrown players to be limited to 13 for Premier League clubs – this plan is set in the context of a post-Brexit Premier League. The FA views the proposal as a mechanism to increase opportunities for domestic talent at elite clubs. The Premier League has opposed the idea however citing the absence of evidence linking quotas with improved performance by the national team.

I can understand the view that the Premier League should not be exempt from the implications of Brexit, but I can only see minor benefits of the FA’s proposal.

Introducing a quota on non-homegrown players could have a range of negative effects for the league. On the pitch, it could impact the competitiveness of English clubs in the Champions League if they are prevented from importing elite talent. Off the pitch, it may serve to increase what seems to be an already artificially high price for English talent – this premium may raise further if  the quota is hardened.

At the moment there is plenty of English talent at top clubs and they make it despite intense international competition; Liverpool have twelve English players, Spurs have nine and Manchester City and Manchester United both have seven in their senior squad. There’s an argument that the current English team is one of the best in the Premier League era despite the internationalisation of the league. English players are likely benefiting from the competition and from foreign coaches and players.

The chart below displays the nationality of Premier League players in percentage terms by season based on whether they are English (white bars), from another EU country (light grey bars) or are non-EU (dark grey bars). Yes, there has been a decline in the level of English talent in the league but the trade-off has been a far superior league to that of the 92/93 season. 

There could be some minor benefits if the FA plan was to come into effect. At present there can be a bottleneck in development pathways for young players. Maybe non-English talent that currently sits on the bench for the majority of the season would be replaced by domestic bench warmers?

All in all, it seems that the cons outweigh the pros. The influx of foreign players post Bosman, mostly from other EU countries, is what made the Premier League one of the best products in the world and added to its marketability.  It is not surprising that the Premier League opposes this move given how the clubs and the league in general have benefited greatly from labour mobility. The conclusion of the Premier League's statement is a powerful  reminder of what an incredible industry and export the Premier League is for England - “Our competition is watched in 189 countries, 700,000 visitors to the UK per season attend a match, clubs employ 12,000 full-time staff and Premier League football generates £3.3bn per season in taxes.”

By Stephen Brosnan

Recently, the English national team have been going through a renaissance period. During this summer’s World Cup the country was hit by a wave of optimism as Gareth Southgate led the team to their best placed finish since 1990. Although football didn’t quite make it ‘home’, hope for the future was well and truly restored. England have moved up to 5th in the FIFA World Rankings and last week, the team added to their growing reputation by topping their Nations League group with impressive victories over Spain and Croatia.

Previously I have analysed England squad selection using data from Fantasy Premier League (FPL) (here, here and here). These posts highlight some potential bias towards selection based on reputation rather than form. Gareth Southgate stated from the beginning of his tenure that players "need to be playing regularly" and "be in good form".

Table 1 shows players selected for the England squad that would be included in squad based on FPL points while Table 2 shows the players that would miss out of the squad and their replacements.  

Table 2 shows the players who would miss out on selection and their replacements should selection be based on FPL points. Some surprising selections include Steve Cook (Bournemouth) in place of John Stones. However, this is due mainly to rotation policy at Man City reducing Stone’s overall points. Also, a trade-off exists between selecting the most in-form players while maintaining a balance between youth and experience. Southgate has stated “we're into a fresh cycle of probably not going back to players who've been in before and that we've had a good look at”. This explains the exclusion of the likes of Theo Walcott, Andros Townsend and Aaron Lennon for Harry Winks, Ruben Loftus Cheek and Jessie Lingard.

Southgate seems to have gone for youth at the expense of form in the midfield area. Perhaps coincidentally, this is also one of England’s most problematic areas with a lack of creativity and a dependency on set pieces being identified as potential weakness in the current squad. Overall, Southgate is selecting the best performing players regardless of reputation and this may go a long way in explaining why these players are delivering results. 

By Robbie Butler

This week the Football Association of Ireland parted ways with manager Martin O'Neill and his backroom team. The search now starts for the next the Republic of Ireland manager, who will become the 15th man to manage the national team. The list is illustrious with the likes of John Giles, Jack Charlton and Giovanni Trappatoni all taking charge of the Boys in Green. 

O'Neill achieved considerable success in relative terms. He managed to qualify the  Republic of Ireland for the European Championship Final in 2016 where the team beat Italy in the Group stages, and also recorded a draw against Sweden in Paris.

While these are notable highlights, one that went under the radar was the teams' success in Vienna in November 2016. James McClean's goal that night ensured the Republic of Ireland's first away win in a group game, against a higher seeded team, since 1967.

Performances since haven't reached the same heights but the team's FIFA Ranking has remained quite stable. 

While there was a notable decline under the most recent manager, O'Neill's team has not had an alarming decline. That's said, relegation to Group C of the UEFA Nations League will make qualifying for Euro 2020 more tricky.