Textbook Notes (363,135)
Canada (158,215)
Economics (727)
ECON 2P03 (10)
Chapter 1

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McMaster University
Hannah Holmes

IntroductionProfessional sports simply means that the athletes are paidEssentially athletes compete either as individuals as in golf on teams as in football hockey etc or in the case of NASCAR as both an individual and team memberAthletes competing in individual sports meet up in tournaments held throughout their seasonTheir earnings come in the form of prize winnings from these tournaments endorsements sponsored appearancesAthletes competing on teams meet each other in regularly scheduled league games and a playoff series to determine the one champion at the end of the seasonThese athletes receive a salary and can also earn income from endorsementsWell spend most of the course examining professional teams in a league structureWhy the Economics of Professional SportsEconomics is the study of how we allocate scarce resources to satisfy societys unlimited wantsMoney is the means by which key resources for example athletes are obtained by and allocated among teams to use in competition against other teamsTo maximize consumption and add revenues leagues sell broadcast rights to television and radio for broadcast of matches Like firms team owners want to maximize profitsmust make economic decisions about how to do thisSport teams also have an impact on their host cities jobs created in arenas and local service industries for exampleLabour athletes coaches managers combine with capital fields equipment etc to produce along with another team a product entertainment in the form of a gameOutput of professional sports is entertainment this product is sold to consumers spectators fans usually in a stadium or arena Gate revenues are needed to pay salaries and so worth etcSpectators need accommodation but access must be denied to nonpayeesNon payeesfree riders Therefore need enclosed stadiaThe sportsleagues well talk about areNational Football League NFLMajor League Baseball MLBNational Hockey League NHLNational Basketball Association NBANASCARCanadian Football League CFLDevelopment of Pro SportsAncient Greeks and Romans believed that athleticism was an important part of educationa sound mind in a sound bodyIn the 19th century in England it was unthinkable that the upper class be paid to play sportsto be paid for something meant you were lower class like a tradespersonOnly poor people and working class would participate in anything like a sportMoreover to be able to have time to pass playing sports you had to actually have leisure time to do soNot until the mid 1800s during the boom of the Industrial Revolution did standards of living became high enough so that the general public could provide a steady fan base that could support professional organizationsSoccer England and baseball US which had both appeared among the more prosperous in society were the first sports to become widely popular national pastimes
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