Competitive balance in professional sports: A multi-dimensional perspective

Abstract

What constitutes competitive balance is a contentious issue in professional sports. We contribute to this debate with a simple framework encapsulating multiple viewpoints of competitive balance and highlight how this framework suggests that there could be an inherent tradeoff along two common dimensions. Using the framework as a lens for comparing North American professional sports leagues, we then demonstrate how important changes over time in the collective bargaining process have influenced the competitive balance of these leagues in different ways. Finally, we discuss and provide descriptive evidence for the influence of differences in non-gate revenue growth across leagues and how it might have affected their competitive balance in recent years. (JEL L83, D63, C23).