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Why do golfers earn more than tennis players?

12/8/2013

 
by Declan Jordan
Last Saturday week (July 27), Johnny Watterson wrote in the Irish Times about the inequality in prize-money in tennis relative to golf. He compared two recent major winners in each sport, Marion Bartoli at Wimbledon and Phil Mickelson at the Open. He said
So Marion Bartoli endures laddish stick from John Inverdale, puts a trembling Sabine Lisicki to the sword and walks away €183,350 richer for a fortnight at Wimbledon than Phil Mickelson did for winning the Scottish Open and British Open in successive weeks. That’s no surprise to those in the lower rungs of tennis, where new racquet strings and food poisoning are more pressing than the fantasy of a staged warm down or massage session.

The Californian lefty earned €579, 080 for his Scottish Open win and €1,097,570 from Muirfield, while Bartoli took €1.86 million for her 1 hour 21 minute win over Lisicki.
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The point is that at the elite end of the sport, tennis players earn as much as their golfing counterparts. However, moving down the ranking list the earnings of golfers far outstrip those of tennis players. Of course, why the comparison is made between Bartoli and Mickelson, rather than Murray and Mickelson is unclear. It should be noted that since 2007 men and women earn the same prize money at Wimbledon. It's also a little misleading to say that Marion Bartoli won €1.86m for her final victory over Sabine Lisicki. It's a little like saying Phil Mickelson won just over €1m for his final putt on Sunday at Muirfield. In fact Bartoli won £800,000 for winning the final. She had already earned that amount at a minimum by winning her previous 6 matches.

The analysis referred to in the Irish Times article comes from a report by Tennis New Zealand on the 'Tennis Poor'. The article points out, among other evidence, that:

The 400th ranked golfer on the money list earned $203,000 (€153,470) in 2011. To reach that kind of income in men’s tennis, a player in 2012 needed to be ranked 137 in the world and a woman needed to be ranked 107.

The Kiwis used the comparison with golf to show how the money alarmingly falls off in tennis after the 200 mark and how the game of Mickelson and McIlroy better catered for their entirety of players.

In 2012 the 200th ranked male on the ATP Tour earned $98,000 (€74,000). In golf the 200th ranked male that year earned $639,000 (€483,000). In 2012 the 250th male on the ATP Tour did not make any profit, while the equivalently ranked golfer made $461,000. Golf in fact kept on giving with the 300th ranked player earning $358,000 (€271,000) and the 350th male taking $264,000 (€200,000).
The report "noted that, given choice, it made more economical sense for an aspiring athlete to play golf." Some may be less sympathetic to tennis players at lower income levels. There are many professions where the elite earn significantly more than the other 99% of those in the profession. I am sure Paul Krugman earns more than I do and if I was unable to earn a living as an economist would I able to convince our Nobel laureates to reduce their salaries and talking fees to help University College Cork to keep me on? I would expect a tough time.

But of course this analysis is overly simplistic because economists do not 'compete' as sports people do and sports people require competition and rivalry, without which no sport exists. In any event, in this post I am more interested in trying to explain at least some of the difference in earnings between the two sports (golf and tennis). 
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The first aspect is being in the top 400 golfers in the world may not be equivalent to being in the top 400 tennis players in the world. It is very difficult to get an idea of how many people play each sport. Golf World suggests there were 61m golfers in the world in 2003. Of these, 37.1m were in America. I couldn't find a comparison for tennis, but the Tennis Industry Association claim 27.1m tennis players in the US in 2011. Even assuming no growth in the number of golfers since 2003 and assuming the same proportionate relationship in the rest of the world as the US, it's likely that there are more golfers than tennis players. This means it's harder to be a top ranked golfer than a top ranked tennis player simply by weight of numbers. This however can't completely explain difference in prize money earnings. 

Another, possibly more convincing, explanation has to do with the structure of competition in each sport. Golf typically has 'first past the post' tournament styles. In a field of up to 120 golfers only one can win and it can be clear after the first round (maybe even sooner) whether a particular golfer is likely to win or not. So how can organisers of tournaments incentivise competitors to keep playing and trying even when it looks like they will finish well down the field. The prize money at the Open at Muirfield shows that there are incentives for players to finish one place higher in the tournament rankings. (Of course some tournaments will also pay appearance fees to select golfers- though this will not affect effort directly so we can ignore this for the purpose of this argument). It's also notable from that prize list that players who miss the cut also receive prize money. 

Tennis tournaments are generally operated on a knock-out basis. This means that the incentive structure has to be such to encourage the player to win the current match. A relatively smaller fee for winning the marginal match will be sufficient incentive to encourage players to put in greater effort. The Wimbledon prize fee structure shows that players will be incentivised by the increased prize from each game. It also means that while one great match will win a lower ranked player some prize money but this is less likely to happen over a week or two-week long tournament. 
In both sports of course the non-prize money earnings are very important elements of overall income. Golfers tend to have significant tournaments each weekend, attracting significant sponsorship (and related prize money). The higher prize money attracts the best golfers which attracts the bigger sponsors. And more players can play in each tournament. Typically in a knock-out tournament with one game per day (at most) there is a limit in the number of players that can be accommodated at the higher ranked tournaments (not all tournaments can run for two weeks like the majors). This limits the opportunities for lower ranked players to play at the top tournaments with the better money. 

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