Political Economy of Football
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Incomes and Goals Slump - A Threat To The Premier League?

 

29/12/2006

A complaint increasingly heard from fans is that clubs outside the top four of the Premiership are increasingly focused on survival because of the increasing costs of relegation and that this leads to negative and boring football. Some support for this view is provided by the fact that the number of goals scored per Premiership match has fallen from an average of 2.79 in 1999-00 to 2.13 to the end of November in the current season.

The Premiership has become the lowest scoring league in Europe. The biggest scorers in Europe are the Dutch with more than three per game. Even the supposedly clinical Germans manage 2.75 while the Scottish Premier and Serie A come in at over 2.5 per game with Spain just under 2.5. To put it another way, there were six 20 goal a season strikers in 1994-5, four in 2003 and last season there were just two, and one of those now plays for Real Madrid.

Perhaps a greater threat to the Premiership comes from falling disposable income. From 1997 to 2001 it grew at an average rate of 3 per cent a year, above the average of 2.7 per cent for the last decades, but since then its growth has halved to just 1.5 per cent a year. Higher taxes have taken their toll, 'fiscal drag' means that the tax take increases because thresholds rise slower than incomes, wages are being held back, in part because of significant levels of inward migration and higher interest rates have had an impact on mortgages and other debts. Energy costs have also risen steeply. The share of pre-tax household income now eaten up by essentials - direct taxes, council tax, interest and regular loan payments and energy costs - has risen to its highest level in 20 years according to investment bank Morgan Stanley.

The traditional response would be that such is the dedication of fans to their clubs that demand for football tickets is highly inelastic, i.e., it is not very price sensitive and is the first call on discretionary leisure income. That may be true for the hard core fan, particularly those without family responsibilities. But there is a substantial periphery of fans who are less committed.

So although we don't go along with gloom and doom fans about the Premiership, it may be that some fans will switch from the substantial costs of watching a game (once travel and food have been factored in) and settle for watching on television. This would be good news for Sky and other providers, but possibly less good for the game.

 


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