The Economics of Football – an Empirical Examination

Introduction

Economists have been interested in sport for quite a long time. A first reason

for this is that sport is an important economic phenomenon. It affects both

work - according to Statistics Canada data, for example, 2% of all employees in

Canada are working in a sports-related activity1 - and leisure - the 2002 Football

World cup for example was watched by over a billion spectators (Hoffman et al,

2002 – country soccer performance).

A second reason why economists are interested in sports, is the abundance of

data. Given the popular interest in sports, a lot of newspapers and fans collect

all kinds of detailed sports data. These detailed data have been used by

economists to test several economic theories. Some of these theories focus on

sports-related issues. One strand of the sports economics literature for

example investigates the need for competitive balance. That is, they try to see

whether it is important that teams are not too different in terms of quality so

that there’s some uncertainty about the outcome of a match. Other economists

use sports data to test theories that are also of importance outside the sports

context. Ehrenberg and Bognanno (1990) for example use golf data to test the

1
http://www.parl.gc.ca/InfocomDoc/36/1/cher/Studies/Reports/sinsrp05/04-rep-e.htm
implications of tournament theory – i.e. that differences in pay-off motivate

people to put effort.

In this paper, we focus on a specific sport, European Football (or soccer).

European football is relatively less researched by economists since data tend to

be less available for European sports – salary data for European sportsmen for

example are very rare compared to salary data for American sportsmen. Still,

there is some literature on European Football, mainly empirical work that

focuses on estimating the demand for football and theoretical work on player

mobility, the latter spurred by the 199X Bosman Case2 (see Matheson, 2003 for

a review). Here, we will give an empirical description of the Economics of

football using a unique database on the French Soccer Championship. Our

dataset includes information on both players characteristics and players

performance, and on team characteristics and team performance. This allow us

to take a look at a whole range of issues that have been covered in the

literature on the Economics of Sports (such as competitive balance, match

attendance etc) and allows us to test a number of theories that are of interest

to economists in general (internal labor markets, incentives).

2
The Bosman case made the free transfer of players possible.
Data Description.

Our dataset brings together data from several sources.

1) Champfoot

Champfoot is a Championship management database that allows users to collect

all kinds of information on a championship. The Champfoot software includes

information on past championships for several countries. From Champfoot, we

selected the data from the French Competition. The reason for this is that the

data on the French competition are the most comprehensive data available

(Champfoot is software written by a Frenchmen, Stephane …). Most important

for us, data on player performance are available for the French Championship.

From Champfoot we extracted the following data on the French Championship.

• list of names of all players of all teams in the first (D1) and second (D2)

division between 1996/97 and 2003/043.

• For each player

o team

o Position on the field

o Goals scored by match

o Cards received (both yellow and red) by match

3
The information for the 1996/97 season is not complete.
 o Minutes played by match (this allows us to infer whether a player

started the match, entered as a substitute or was substituted).

Note that players that were hired by a team but never played for

that team in a given season are included in the database.

o France Foot Player Rating – France Foot is a magazine that

specializes in Football. For each game, its reporters evaluate the

performance of each player by assigning to each player a number of

stars ranging from 0 to 6 stars. To get a positive number of stars, a

player has to play at least a full half-time or 45 minutes. A player

who is sanctioned a red card systematically receives a 0 rating. The

better the performance, the higher the number of stars.

• For each match

o number of spectators

o for first division matches, the quality of the match – the France

Foot reporters do not only evaluate the quality of the players’

performance they also evaluate the quality of the match by giving it

a score between 0 and 20.

o Number of goals/cards/substitutes, team composition etc (all of

which can be computed on the basis of the information that is

available for players

 o The number of the match, which indicates whether the match was

played at the end or the beginning of the match.

2) Equipe player performance database.

L’ Equipe is the biggest French sports daily. Like France Foot, its reporters also

evaluate the performance of football players (scores between 1 and 10). We

obtained from one of its journalists a file with player ratings for the first

division championships 97/98, 98/99 and 02/03.

3) Football data.co.uk

Football data.co.uk collects odds data for French football matches in both

division 1 and 2 since the 2000/01 season. Odds data are often used to measure

the expectations of unbalancedness of a given match.

4) Distances between cities

From ???, we get distances between cities.

From Champfoot we can get an idea about the careers of football players

between 96/97 and 2003/2004. However, we only have complete information

about careers of those players who remained in the first and second division of

the French competition during the whole period. Incomplete information is

available for players who left France, for players who entered the French

competition after 1996/97 or for players who started their career before

1996/1997. To complement the Champfoot data, we use 2 additional database -

the Internet Player History Database and L’Equipe’s player history database.

5) Internet Player History Database

The player history database is a internet database with over 30000 histories of

football players.

We extracted, for each football player included in the Champfoot database,

information on:

• nationality

• second nationality

• country of birth

• date of birth

• height

• weight

• ever selected for first national team

• ever selected for youth national team

• retired or not

6) Equipe player database

On its website, L’Equipe has career information of football players. We

extracted, for each football player in the Champfoot database, information on:

• nationality

• birthdate

• height

• weight

• clubs played for by season.

• Number of matches played by season

• Number of goals played by season

• Ever selected for national team or not

Combining these 3 databases gives us a much better idea about the careers of

football players4.

Descriptive Analysis of the data

A) Is There Leniency and Centrality Bias?

Table 1 gives the distribution of France Foot’s player ratings over the 6

different categories for the French first division over the period 1996-2003.

Table 1: France Foot’s player ratings Division 1

Division 1 1996 1997 1998 1999 2000 2001 2002 2003
1 0.31 0.07 0.22 0.07 0.24 0.09 0.13 0.17
4
We started with the Champfoot database, than filled in data gaps with info from the playerhistory and then used
the Equipe database to fill in remaining gaps.
 2 9.44 10.2 10.79 10.44 12.56 10.9 9.89 12.92
3 62.48 60.31 58.94 58.59 59.24 62.95 61.22 63.05
4 25.05 26.89 27.22 27.82 25.62 23.93 26.49 21.87
5 2.63 2.43 2.72 3.02 2.28 2.08 2.23 1.95
6 0.08 0.1 0.1 0.06 0.06 0.06 0.02 0.04
Average 3.21 3.22 3.22 3.23 3.17 3.17 3.21 3.13
# 6152 6802 6792 6793 6784 7021 8330 8350

The ratings do show signs of centrality bias and or leniency bias – that is,

extreme ratings are very little used and bad grades are rarely given. Such

tendencies are often observed in subjective performance evaluation. These

biases are typically explained by the fact that supervisors do not like to give

bad grades to people with whom they interact closely (see Murphy,1991 and

Prendergast, 1999). Murphy (1991), for example writes: ‘There’s an important

agency problem between the supervisor/manager and the owners of the firm:

for a variety of reasons, managers prefer to assign uniform ratings to

employees regardless of performance. Self interested managers have little

incentive to invest in performance evaluation, both because careful appraisals

take time away from better-rewarded activities, and because managers face

large nonpecuniary costs from disgruntled employees with mediocre or low

evaluations‘. Note that despite the fact that in our setting there’s very little

direct contact between players and reporters, we still notice the same

tendencies.

Table 2: France Foot’s player ratings Division 2

Division 2 1996 1997 1998 1999 2000 2001 2002 2003
1 NA 0.02 0.07 0.04 0.08 0.01 0 0.06
2 NA 5.54 4.19 4.34 5.16 4.37 4.57 7.61
3 NA 58.14 68.5 65.04 64.04 63.66 65.25 64.27
4 NA 33.05 25.03 28.29 28.32 29.37 27.49 26.03
5 NA 3.18 2.08 2.27 2.38 2.54 2.62 2.01
6 NA 0.07 0.13 0.02 0.01 0.04 0.07 0.02
Average NA 3.34 3.25 3.28 3.28 3.3 3.28 3.22
Number 10235 8704 8424 8471 8413 8353 8328
Leniency and centrality bias also show up in the division 2 ratings. Surprisingly,

however, grades in division 2 are higher on average – the main difference with

division 1 being that the low grade 2 is less often used! This finding provides

strong evidence for a leniency bias – despite the fact that second division

football is objectively of worse quality (f.e. it is very exceptional that second

division football players are selected for the national team and second division

teams tend to lose from first division teams in the direct confrontations of the

cup matches), subjective performance evaluation does not show such difference.

Besides the ratings by the journalists of France Football, we also have data on

the ratings by journalists of the sports journal, L’Equipe for division one games

in three seasons. The grades of L’Equipe cover a larger range (1 to 10). Still,

centrality and leniency bias are observable here too.

Table 3: Grades L’Equipe

Points 1997 1998 2002
2 0.0147 0 0
2.5 0.0147 0.0885 0
3 0.2494 0.5161 0.2029
3.5 0.6601 1.0765 0.8951
4 5.0609 5.9283 5.3706
4.5 7.7307 11.7239 11.3975
5 22.928 24.4064 24.5614
5.5 22.7226 23.9493 26.4113
6 25.0697 19.9381 20.0143
6.5 9.2269 8.1846 7.5785
7 4.4448 2.9789 2.6256
7.5 1.1735 0.7668 0.7399
8 0.6014 0.3539 0.1313
8.5 0.1027 0.0737 0.0597
9 0 0.0147 0.0119
Average 5.5376 5.3878 5.3951
Nr 6817 6781 8380

Computing the correlation between the France Football ratings and the Equipe

ratings, show a strong positive correlation: 0.59 for 1997 and 0.57 5 for both
5
Rank correlations are of similar magnitudes.
1998 and 2002. Though strongly correlated they are far from perfectly

coordinated, suggesting that there is a substantial ‘subjectivity’ in rating

football players’ performance.

Table 4: Match Statistics

1996 1997 1998 1999 2000 2001 2002 2003
4 0 0 0 0.33 0 0 0 0
5 0.27 0 0 0 0 0 0 0
6 0.27 0.33 0 0 0 0 0.27 0
7 0.27 0.66 1.31 0.33 0.7 0.33 0 1.6
8 6.1 3.64 2.95 1.63 3.14 2.61 4.77 2.93
9 4.77 3.97 6.23 2.94 6.27 2.61 3.71 5.85
10 11.67 13.58 9.84 10.78 9.06 12.42 10.88 13.83
11 20.69 19.54 17.05 13.73 22.3 20.26 22.55 19.15
12 27.85 31.13 29.84 30.07 27.53 30.07 29.71 30.85
13 20.69 14.9 19.02 24.18 18.82 17.97 16.18 16.76
14 5.31 8.61 10.82 10.78 9.41 12.09 9.55 7.18
15 1.86 1.66 1.64 3.92 2.44 1.63 2.12 1.86
16 0.27 1.32 0.33 0.98 0.35 0 0.27 0
17 0 0.66 0.66 0.33 0 0 0 0
18 0 0 0 0 0 0 0 0
19 0 0 0.33 0 0 0 0 0
20 0 0 0 0 0 0 0 0
Average 11.58 11.79 11.79 12.08 12.29 11.82 11.74 11.63
Number 380 306 305 306 306 306 380 380

Also for matches we find leniency and centrality biases – here again explanations

based on personal interaction that leads to a disutility of giving bad grades fail –

hence the disutility of giving bad grades seems to be wider.

B) Did French Football change over time?

Commentators often argue that the quality of the French competition has

worsened as a consequence of the increased internationalisation of the football

transfer market. For example, Raymond Domenech trainer of the French youth

national team claims (Le Monde, 30/03/1998, p. 20) that the departure of the
best French young players has weakened the French clubs6. Looking back at

table 1-4 one can notice that there’s little change over time. Both the

distribution over grades and the average player grade are stable between 1996

and 2003. And the average match score first increased somewhat, then

decreased, which confirms the results based on player ratings of little evidence

for a decreasing quality of the French competition over time.

Some have argued that football has become more defensive. Mention (2000) for

example shows that during the sixties the goals per game dropped substantially

to remain at a low level ever since. Since we have for each player, the position on

the field – that is whether they are goalkeeper, whether they play in the attack,

the middle or the defense – we can look whether different positions got used to

a different extent over time, i.e. whether French football has, for example,

become more defensive over the period 1996/7-2003/4. The answer can be

found in table 5.

Table 4 : Ratings and position on the field

Goalkeepers Goalkeepers Attacker Attack % Middle Middle % Defense Defense
note % note note note %
1996 3.43 0.09 3.15 0.2 3.22 0.34 3.16 0.38
1997 3.42 0.09 3.17 0.2 3.26 0.34 3.15 0.37
1998 3.5 0.09 3.17 0.2 3.24 0.34 3.16 0.36
1999 3.43 0.09 3.21 0.21 3.25 0.37 3.18 0.34
2000 3.4 0.09 3.14 0.21 3.18 0.34 3.13 0.36
2001 3.37 0.09 3.15 0.2 3.18 0.36 3.13 0.36
2002 3.43 0.09 3.17 0.19 3.22 0.34 3.16 0.38
2003 3.27 0.09 3.12 0.21 3.15 0.34 3.07 0.36

6
Raymond Domenech déplore la baisse de niveau du football français. Dans un entretien au "Monde",
l'entraîneur des Espoirs analyse, avant le choc Metz-Lens, le parcours des deux équipes actuellement en
tête du championnat de première division. Il affirme que le départ de leurs meilleurs jeunes à l'étranger a
affaibli les clubs nationaux.
No clear tendency over time can be observed in the use of different positions

over time, thus rejecting the idea that ‘strategy’ has changed over time. Mention

(2000) also comes to the conclusion that the number

C) Grades by player characteristics

Table 5 also investigates whether different positions get on average different

grades. It shows that on average, goalkeepers get better grades, followed by

midfielders, attackers and defenders. Differences are relatively small however.

We also have statistics on age – descriptive statistics shows that average FF

rating increases with age.

While at first sight this might be surprising since physical shape and career

concern incentives should decline over time, selection (sorting) is a likely

explanation – the worst players simply stop playing in the first or second

division. A fixed effect analysis should be able to distinguish between these

effects. Note that also the variance (both individual variance within a season as

the variance over different players) decreases with time.

D) Do Creative and Destructive Effort Go Together?

Another question is whether ‘creative’ effort goes together with ‘destructive

effort’. Lazear (1989) for example shows that increasing the prize in a relative

performance contest will not only increase effort but also increase the level of

‘sabotage’ (destructive effort). The intuition behind this is that you can beat

your competitor by working hard but also by preventing him from getting a good

result. Football games are clearly relative performance contests – there are two

competitors and only the best get points. If some games are more important

than others, we would expect that in those matches the players put more

creative effort (i.e. play better) but also do more to prevent the other team

from scoring (for example, by playing less fair). An indicator of creative effort

can be the rating, an indicator for destructive effort, whether one gets a yellow

card or not. Players with yellow card have on average a lower rating (3.2067)

then those without (3.2446) which goes against Lazear’s idea. However, an

alternative explanation for this finding is that the experts evaluate the cards as

something negative and reflect this in their ratings – indeed a red card

automatically translates into a 0 rating. (Perhaps we should indicate here that

econometric results tend to show the contrary?)

E) Why Is There A Home Advantage?

It’s a stylised fact that there’s a home advantage: Forrest and Simmons (2000)

for example mention that in England home teams win twice as many matches as

away teams. The same is true in our French data: 49,9% of first division

matches are won by the home team, against 23% by the away team. In the

second division, 46.1% of all games are won by the home team, against 21% by

the away team – in both cases, home teams are about 2.2 times more likely to

win.

One might wonder why home teams are more likely to win. One explanation is

that they are playing better at home. Descriptive statistics seem to indicate

that this is indeed the case. The average player rating of the home team is

higher than the average player rating of the away team.

Table 6: Home team vs. away team ratings

Year Division Number Avg home Avg away Number Avg home Avg away
of FF FF of EQ EQ
matches matches
1996 1 276 3.2586 3.1551 0 NaN NaN
1996 2 0 NaN NaN 0 NaN NaN
1997 1 306 3.2671 3.1727 306 5.6313 5.4515
1997 2 462 3.4283 3.2566 0 NaN NaN
1998 1 305 3.3038 3.1362 306 5.506 5.2746
1998 2 380 3.305 3.2198 0 NaN NaN
1999 1 306 3.3286 3.144 0 NaN NaN
1999 2 380 3.3217 3.254 0 NaN NaN
2000 1 305 3.2075 3.1474 0 NaN NaN
2000 2 380 3.3442 3.2137 0 NaN NaN
2001 1 306 3.2417 3.1092 0 NaN NaN
2001 2 378 3.3442 3.2535 0 NaN NaN
2002 1 379 3.2546 3.1654 380 5.4805 5.3136
2002 2 380 3.3529 3.2168 0 NaN NaN
2003 1 379 3.1815 3.0727 0 NaN NaN
2003 2 380 3.2857 3.1636 0 NaN NaN

Note that an alternative explanation for this finding is that if reporters choose

which matches to visit, they are more likely to visit the teams they support and

hence, they might give these too high points. According to France Football, a
fraction of the home team advantage could come from the fact that the journal

outsources part of its rating activity to local reporters who FF judges to be

more lenient towards the home team than the FF experts 7 – we checked this by

looking at the difference between home and away matches in division one and

two – while the average difference in division one is 0.1184, it is 0.1172 in

division 2 (period 1997/98 – 2003/04). Hence, the local reporters do NOT seem

to be more favorable towards the home team than the FF experts.

Playing well indeed does pays off. That is, teams that play well are more likely to

win. The statistics point in this direction: if the home team is having a higher

player rating than the away team, the home teams wins in 75.9% of all matches,

it draws in 21.67% and loses only 2.43% (using data from L’Equipe these

percentages are 77.23%, 20.07% and 2.7 % respectively).

When the away team is better than the home team, it wins 59,24% of the

matches, draws in 34,33% and loses in 6,43% ( for L’Equipe, 55.08%, 37.43%,

7.49%). This difference between the relation of match score and win percentage

for home and away teams might indicate that the reporters prefer the home

team to win. Indeed, if the average match rating of home team wins is 12.1894,

of draws 11.3596 and of away victories 11.5931. An alternative explanation is

that away team wins are simply less convincing.

Differences in strategy might be another explanation for the home advantage -

home and away team have strategies that are indeed somewhat different: home

teams begin a match on average with more offensive players (2.25 vs 2.1) and

less defensive players (3.96 vs 4.09).

7
FF also explains that the higher average rating for D2 players by this higher proportion of local
reporters in Division 2.
Strategy indeed is related to the chance of winning: If the home team has more

offensive players (than the away team), the home team wins in 47.1% of the

cases, draws in 20.5% and loses in 32.3% of the cases. If the away team has

more offensive players (than the home team), the away team wins in 20.7% of

the cases, draws in 45.1% and loses in 34.1% of the cases. This seems to suggest

that for a home team a more offensive tactic pays off while for an away team

it’s better to defend.

D) Incentives and End –of-season matches

There are several championship related incentives for teams in the football

championship – a team can win the championship, it can win a place in the

championship league, it can qualify for the UEFA cup and it can qualify for the

INTERTOTO cup (which is a pre-season international tournament the winners of

which qualify for the UEFA cup). In addition, there are the incentives coming

from the fear of relegation. Because at the end of the season, the winners and

losers of a championship are already known, many observers expect lower quality

games at the end of the season (any press articles on this?).

Figure 1 shows that match quality has some tendency to decline towards the

middle of the season, then increases slowly to end up at the same level as

before. Hence, there is no clear evidence of an end-of season effect. No end-of-

season effect could be found in the player ratings either.

To investigate the reasons for the absence of such effect, we computed the

percentage of matches where one of the teams had nothing to loose or win

anymore – using the first division data for 1997-2003.

Number of games % of al games

Sure Champion 4.0000 0.17
Sure Champions League 3.0000 0.13

+ no Champion
Sure UEFA + no 4.0000 0.17

Champions League
Sure intertoto + no 5.0000 0.22

UEFA
Sure no relegation + no 36.0000 1.57

intertoto
Sure Relegation 15.0000 0.66

It turns out that there only in 2.93% of all matches there is at least one team

that has nothing to win or lose anymore – 4 matches included a team that was

already sure to win the championship, 3 matches had a team that was sure to win

a champions league place but was also sure not to become champion anymore. 36

matches had a team that couldn’t win any prize but also couldn’t be relegated

anymore. And in 15 cases a team was involved that already was sure to be

relegated. Of the 2290 first division matches only 14 matches where between

two teams that had nothing to win or lose anymore (not in the table) - So, as far

as the French first division is concerned, the prize structure is such that

incentives are present in basically every game played.

Next, we look at the second division – second division has a less extensive

incentive structure – there is only the possibility to be promoted or to be

relegated – no tickets for international competitions are at stake. But even

there only 7.15% of the games had at least one team that had nothing to win or

lose anymore, and only 2.66% of the games (not in table) were between two

teams that had nothing to win or lose anymore.

Number % of al
of games
games
Sure Promotion 40 0.0146
Sure no relegation + no promotion 131 0.0478
Sure Relegation 25 0.0091
Next we check whether such matches with less (or no) champion-related team

efforts are of lower quality – first division matches where two teams have such

incentives have an average rating of 11.85, against 12 for matches where at least

one such teams has no such incentives. If the home team has no incentives

anymore, the average player rating of the home team is 3.21 (3.32 for the

second division), against 3.25 if there are incentives (3.34 for the second

division) – for the away team, the average player rating is 3.13 (3.23) both when

there are and when there are no championship incentives.

These statistics suggest that championship related team incentives are not

crucial for the quality of a game or the quality of the players’ play. A potential

explanation for this finding is the presence of other incentives – players can

decide to play well because of match premia that are related to winning a match

(the typical contract will indeed have explicit rewards that are a function of the

number of points a team gets) or because of career concerns.

We can also check the effect of this on spectators to see the effect of

competitive balance!

Of course, so far we have used zero-one indicators to reflect the incentives – a

team is only considered not to have incentives coming from the champions’ title

anymore once it is mathematically impossible for that team to win the

championship. Of course, a team that is 20 points behind the leader will probably

not believe it can become champion anymore even if there are still 30 points to

win. Therefore, we next compute an incentive indicator based on historical data.

We take the championships from after the second world war and look at the

points evolution of the champion. That is, we look at each match Y of the

competition and ask the following question: suppose that before match Y, we are
X points behind the leader – what is the chance that we still become champion.

To answer this question we run, for each stage of the championship, a logit

regression where the dependent variable is a dummy, that takes one for the

team that eventually becomes champion and zero for the other teams, and the

explicative variable is the difference in points between the leader and the other

teams, for each match, using data from postwar Division championships. Using

the logit results, we can compute predicted probabilities for each point

difference. These probabilities tell us what the chance is to become champion if

you are X points behind at match Y of the championship.

Fig 1 graphs the probability of winning the championship if a team is 0,1,2,3,4

points behind the leader at different stages of the championship using the 33

post WW2 championships which had 20 teams (18 others had 18 teams).
If after match 1 you have the same level of points as the leader, your ceteris

paribus chances to win the title are about 10% (against 0.05% before the start

of the championship). As one can see, being at the same level as the leader

increases your probability of winning the title as the season continues. After the

37th match, if you still have the same points as the leader, the chance of winning

the championship is 94%. Being one point behind the leader is more detrimental

to the chances to win the cup than at the end – if you are 1 point behind the

leader after the first match of the season, your chance to win the championship

are less than 5%. But being one point behind the leader after the 32nd match

give you more than 30% chance to win the championship. However, if after the

37th match, you are still one point behind the leader, the chance of still winning

the championship is only 9%. While these results are plausible, there are some

shortcomings – if there are two teams sharing the leadership position after the

37th match it’s unlikely both will think of themselves as having 94% chances to

win. Similar, after the 37th the team at the top position has 94% chance while

the team at one point behind the leader has 9%, these probabilities sum up to

more than 100%.

E. Competitive Balance

The literature on competitive balance claims that fans will lose interest in the

game when there is no match uncertainty – that is, if it’s unlikely that your team

will win or if you’re sure your team will lose, you will not be interested to watch

the game. The empirical literature only offers limited support for this

(Szymanski, 2004?).

Our data allow us to add to this discussion by investigating whether balanced

matches are of higher quality than unbalanced matches. If a supporter is sure

that his team will lose he might still be interested in going to the stadium just to

see a good game.

To take a first look at this issue, we look at the correlation between goal

difference and the quality of the match – if experts like unbalanced matches, we

should find a positive correlation. Overall correlation is 0.29. Hence, experts

like unbalancedness. Splitting up the sample in home wins and away wins, we find

that the correlation is stronger for home wins (0.31) than for away wins (0.19).

A second question is how strong ex ante unbalancedness is related to match

unbalancedness – ex ante unbalancedness is often measured by the odds. The

correlation between our measure of ex ante unbalancedness (the absolute value

of the difference in winning probabilities (based on odds from the Interwetten

bookmaker) between the home and away team) and our measure of ex post

unbalancedness (the absolute value of the difference between the average home

player performance and the average away player performance) was about zero

(using 2743 matches). Similar, the correlation between the quality of a match

and the measure of unbalancedness was small (even negative). So unbalanced

matches do not seem to be higher quality matches.

2. Regressions

Before starting with the regressions, let’s look at the factors that will influence

a football game.

The Coach

First we have incentives for the teams before the match. These incentives will

determine the decisions of the coach who will choose the players that are best
for the tactics he sees appropriate for the game. A first decision a coach has

to make is on team tactics – is the team going to play offensive or defensive. We

can observe this choice by counting how many offensive players, how many

midfielders and how many defenders are used.

A second decision is on team heterogeneity - the coach can choose players that

have about the same age or can prefer a mix of young and old. He can prefer to

mix star-players with lesser quality players or prefer to have a homogenous

‘average’ team. He can choose players from different nationalities or he can

make it an international team. He can choose players that all speak the same

language or can assume that language doesn’t matter. Several studies have

studied the impact of team heterogeneity on performance (see f.e. Hamilton et

al 200?, lazear etc).

Heterogeneity also affects football teams. Any regular spectator of a game

between two national teams knows for example that there are important

differences in the style and tactic which different national teams use. The

Economists (May 30, 2002) quotes Jorge Valdano (Argentina, 1986 World Cup)

as saying “The Brazilians play like they dance; the Germans play like they make

cars, with lots of technical efficiency and not much left to the imagination; the

English run hard all the time, maybe because of the weather; the Spanish are a

mosaic of regional styles, which has yet to find a national pattern. And the

Italians,” he pauses and frowns, “they are a paradox. In every other area they

export style and flair to the world; but in football they've allowed the ideal of

collective organisation to crush individual talent.”

Empirical work of Yamanaka, Hughes and Lott (1995) confirms this: ‘Because of

the different ways in which soccer has developed throughout the world, the
range of climates in which it is played and the varying temperaments associated

with individual nations, there would appear to be styles of play unique to areas

of the globe’ and conclude their empirical research as following:’ It is clear that

the overall patterns of the British Isles teams differ from the other groups

examined in the way they build up their attack from defense, using the goal kick

and long forward passes. They also showed a dominance in the air. European

teams tended to build the play using short passes, runs, and dribbles, reducing

the risk of losing possession. The South American teams had a high ratio of

shots to crosses with a higher percentage of crosses coming from the final

sixth of the field. It was also concluded that Cameroun exhibited similarities to

the game patterns played by the teams of South America, more so than the

other two groups, from the British Isles and Europe. The main differences were

attributed to a more defensive emphasis to their game.8”

Mixing players with widely varying styles can be advantageous but is not without

danger and communication between those players on the pitch could be

important to synchronize all of them. . This is confirmed by observations

originating in the professional football world. In an interview a player of PSV,

the previous Champion of the Dutch competition, explains the current poor

performance of the team as follows: ‘The problem is too many players left the

team on a short time. Moreover, in most cases, it were Dutch internationals that

left and were replaced by foreigners. This caused, certainly during the first few

months for an incredible linguistic confusion. We simply didn’t understand each

other. Obviously, this makes good results very difficult to achieve.’ (HUMO,

16/3/99). Similarly, just before the start of the new competition, a journalist

asked a player of the Belgian first division team Club Brugge the following

8
This evidence was based on the team-performance during the 1990 Worldcup so it isn’t possible to decide
whether these differences are really due to differences in nationalities or differences in coaching-style. Still,
national coaches do have generally the nationality of the team they are coaching.
question: ‘Club Brugge did buy Belgian to replace Van Der Elst [ a famous Belgian

player]. The supporters love it. And the players?’ The player of Brugge

answered:’ It’s nicer that more Dutch is spoken during the training. English and

French are now spoken less. Which obliges the foreigners to learn our language.

It isn’t that foreigners have worse characters than Belgians. The club did well

changing its policy. One language is better than six languages.’ Trainers also

know the importance of language. . In an interview with a Belgian (Dutch-

speaking) player of Karlsruhe, a German team, a journalist asked whether,

because the team has 5 Dutch players and 3 Belgian players, Dutch is spoken in

the dressing room rather than German. The player’s answer again illustrates the

importance of language : ‘No, Huub Stevens, the trainer, insists that we speak

German. There are also two Tsjech ,one Russian and one Norwegian player, so it

would be quite a mess when everybody spoke his own language. So everybody

talks German.’(Humo25/08/98). Finally, several teams (Genk, NAC Breda,

Charleroi) organize language-lessons for their foreign players.

An additional problem with mixing nationalities is the lack of synchronization

between the ‘national-team’ calendars of the different nationalities and the

competition-calendar of the respective country. At weekends in which a game of

the national team is scheduled, the competition is suspended. However, foreign

players that are part of other national teams can not count on this

synchronization. Implying that if, for example, a French team bought all the

best Dutch players, it would be possible that, every time, the Dutch national

team plays, the French team would have to field their ‘second’-team. That this is

important is illustrated by the attempts of Barcelona to change the rules that

say that teams have to release their players when the latter are called on to

play in the national team (24/10/1996-Reuters-internet)’.

Mixing players different in one team can increase the strength of the team due

to complementarities in football-style but as this goes together with an increase

in the number of languages, communication problems could arise9. In addition,

absences of foreign key-players that are selected for their own national teams

can also have negative effects.

As indicators of heterogeneity we have

• heterogeneity in age: the standard deviation of the log of age

• heterogeneity in height: the standard deviation of the log of height

• heterogeneity in weight: the standard deviation of the log of weight

• heterogeneity in nationality: herfindahl based on shares of nationalities

• heterogeneity in language: herfindahl based on shares of languages (to be

done)

• heterogeneity in performance: based on FF ratings

• heterogeneity in experience: based on number of games played

• heterogeneity in club tenure: how many players on the team where on the

team last year/ before?

The players

In addition to picking the players the coach can give recommendations to players

on how to play. Given the incentives of the match, the players will then decide

about their use of effort – they can either do creative efforts which are match

improving, some of which are measured like number of goals or decisive passes

or they can choose for destructive efforts which are match-deteriorating, some
9
If this idea is confirmed, the fact that France became World Champion can be explained by its multi-ethnic but
uni-language composition, while the poor performance of the Belgian team isn’t anything more than the
consequence of combining two languages in one team without the advantages of more ethnic variety. Moreover,
it could give a rationale for naturalizing foreigners to increase the ethnic variety of the teams.
of which leads to measured stats like a yellow card. Of course, some effort is

not captured by objective variables, for example somebody making a foul that is

not sanctioned by the referee or somebody nearly scoring a goal from far

distance. Both the measured and the non-measured actions will be captured by

the player performance ratings10.

The Match

The effort of the players and the strategy chosen by the coach will determine

the outcome of the game: whether the team wins, loses or draws but also other

outcomes like how unbalanced the game was. Both these results will influence

the match rating.

Match regressions

To explain the match ratings, we will take 3 different strategies. First, we can

take only objective match performance indicators like goals, the number of

passes etc. The problem with this approach is that we only have a limited number

of objective indicators, hence our estimates could be subject to omitted

variable bias. As an alternative, we can use the subjective performance

indicators, the players’ ratings, as explicative variables. The subjective

performance should capture all different aspects of player quality. As a third

option, we can combine both indicators so as to get unbiased estimates of the

measured objective indicators– the problem with the latter strategy is that the

subjective performance indicators of the players incorporate the objective

information – a goal scored will both influence the goal indicator and the rating

10
An important assumption we make is that a player’s performance rating is independent of the other players’
performance. One could easily imagine that this assumption is violated – giving a good decisive pass to a good
player who then scores might be valuated more than the same good pass to a bad player who then misses.
indicator – one alternative strategy would be the following – we run a players

rating regression and then use the errors of the regression (average for a given

match and team) as additional explicative variable together with the objective

indicators for the match. Those errors then reflect the quality element that is

not reflected in the objective measures. – using estimated variables as

regressors gives errors in variables see Pagan (1984 international economic

review, 25, p221) : Excellent.

We take the following objective determinants of quality of a game

As indicators of creative effort

• Number of offensive players

• Number of goals scored

• Number of decisive passes

As indicator of destructive effort

• Number of defensive players

• Number of yellow cards

• Number of red cards

The numbers of defensive and offensive players are indicators for the

strategy of the teams – seeing a game between two offensive-minded teams

should lead to more excitement then seeing two defensive teams.

Idea for a “game theory” paper: What determines the probability of getting

two offensive or defensive teams, etc.

We further have

• Score/pass/cards difference (absolute value) – supporters cannot only be

interested in the total number of goals but also in the goal difference.

Note that these indicators capture the balancedness of the match. We

 also include the difference in the number of passes, the number of yellow

cards and the number of offensive and defensive players. To allow for a

possible non-linear relation we also include the square of the score

difference.

• A dummy for the number of the match, with higher numbers meaning a

match later in the season. This is to check whether there’s an end of

season effect. One could argue that at the end of the season a lot of

teams have nothing too lose or win anymore so they have less incentives to

win. (A nice thing would be to create dummy that takes one when a team

has nothing to lose anymore and a dummy that takes one when a team has

nothing to win anymore – and check the effect of that on win percentage,

quality of player notes, yellow cards,team strategy etc – title the effect

of incentives on team performance/individual performance – nice in terms

of carrots versus sticks and also because here incentive rule is exogenous

look at Bognano/Ehrenberg Golf paper – note also find trainer changes!):

En effet !

As subjective variables we have

• players rating: the average note of the players on the pitch – note that we

assume that the quality of the match does not influence the notes a

player gets.

• balance between the two teams: the absolute value of the difference

between the average notes of the players of the two teams. We include

this variable to check for the importance of competitive balance. By

including this variable we can check whether more balanced games are

better games or not. If we find that more balanced games are better,

this would provide support for competitiveness reducing measures like

 restrictions on player mobility or redistribution of TV-revenues. To allow

for a possible non-linear relation we also include balance squared.

• The average variance of effort – what do experts prefer, that the whole

team plays well or do we prefer a great performance of some players?

This variable is defined as the average of the two teams’ variance of

players’ notes

We use three different estimation methods. Column 1 gives the OLS estimates.

Since we have multiple observations for each specific combination of two teams

(i.e. Bordeaux meets Lyon 2 times in every season) we also run a fixed effect

regression (column 2) – on the basis of an F-test fixed effects is to be

preferred over OLS a Hausman test chooses fixed effects over random effects.

Since our notes are ordered categories we in fact should use ordered probit

(column 3) as estimation method. However, since the number of categories is

high, interpretation of an ordered probit is cumbersome since there are

different marginal effects for each category. The significance of the variables

however is not affected by the estimation method. We therefore will focus for

the interpretation on the fixed effects estimates.

Table 7: Parameters estimates for objective

factors affecting France Football Grades

Variable OLS Fixed Effect Ordered probit

# offensive players -0.025 0.02 -0.013
(-0.77) (0.56) (-0.58)
# goals scored 0.293 0.295 0.214
(9.67) (9.2) (9.82)
# decisive passes 0.116 0.108 0.089
(2.48) (2.23) (2.69)
# defensive players -0.084 -0.077 -0.061
(-3.01) (-2.44) (-3.08)
# (first) yellow cards 0.027 0.028 0.017
(1.48) (1.49) (1.33)
# red cards -0.219 -0.169 -0.156
(-3.9) (-2.87) (-3.92)
Goal difference 0.245 0.237 0.163
 (3.51) (3.27)
(3.28)
Goal difference squared -0.001 0.00 0.005
(-0.06) (-0.01) (0.41)
Difference in yellow cards 0.02 0.033 0.014
(0.65) (1.01) (0.61)
Differences in passes -0.012 0.001 -0.015
(-0.22) (0.02) (-0.37)
Differences in # of -0.099 -0.063 -0.074
offensive players (-2.26) (-1.39) (-2.39)
Differences in # of -0.134 -0.112 -0.091
defensive players (-3.28) (-2.56) (-3.15)
Adjusted R2 0.21 0.22 0.07
# obs 2259 2259 2259

*dummies for years and nr of match are included.

The R2 for the ordered probit is the pseudo R2.

[Probably better to ADD DIFFERENCE IN RED CARDS and then not include

squares to have similarity with home away regression]

The results are as follows – as far as strategy is concerned, experts do not like

defensive teams – each extra defensive player on the field decreases the match

note by 0.08. Whether coaches decide to use extra attackers or extra

midfielders seems to be less important – our variable counting the number of

attackers is insignificant. More goals and more passes lead to higher notes. Each

extra goal is worth 0.3 points, each extra decisive pass 0.1. The number of

(first) yellow cards has a positive effect albeit only marginally significant. Red

cards in contrast have a negative effect on the match note. The variables

indicating unbalancedness give interesting results. Experts like matches that are

unbalanced in terms of scores – a 2-0 victory is getting a half a point score more

than a draw 1-1 draw, ceteris paribus - but do not like matches where teams are

unbalanced in terms of number of offensive and defensive players – that is a

match where one team is very offensive and the other is very defensive is

generally not leading to a high match note. So experts seem to like balancedness

in tactics (ex ante) while unbalancedness in outcome (ex post). Very nice
The (not reported) dummies for the effect of the number of the match show

that matches later in the season do not receive higher notes than the matches

at the beginning. This is a surprising finding since one would expect that, at the

end of the season, several teams have nothing more to lose or to win. Perhaps

the effect is well captured by balance variables.

The (not reported) coefficients of the dummies for the years are not significant

for the OLS and the ordered probit specification, but the fixed effects

specification does indicate that, conditionally on the measured factors like

goals, passes and cards, matches in 1997-1999 received higher notes than those

in the season 2000-2003.

Finally, a Ramsey RESET test using powers of the independent variables rejects

the null hypothesis that the model has no omitted variables at a 5% level. This

outcome may indicate that additional variables are needed to correctly specify

the rating equation.

Subjective Variables

Next we look at the results of using the variables based on subjective

performance evaluations.

Table 8: Parameters estimates for subjective

factors affecting France Football Grades
Variable OLS Fixed Ordered
Effect probit
Note teams 3.06 3.14 2.24
(22.7) (22.1) (21.25)
Difference 0.96 0.90 0.75
in notes (4.61) (4.15) (4.87)
Difference 0.30 0.27 0.22
in notes (2.07) (1.81) (2.07)
squared
Variance 0.76 0.60 0.65
within (3.96) (2.88) (4.61)
teams
Adjusted R2 0.26 0.28 0.09
# obs 2259 2259 2259
*dummies for years and nr of match
are included.
The R2 for the ordered probit is the pseudo R2.
When teams play better, you get a better match: an increase in the average

performance of a team by one point extra (on a scale of six) increases the match

score by 3 points. But unbalanced performances are preferred: a match between

a team with on average 3 points and team with on average 5 points is better than

a match between 2 teams that have about the same point average. Note that

moreover the squared term is positive, stressing even more the importance of

unbalancedness11. Again like goals, this is an indication of the importance of ex-

post unbalancedness, that is unbalancedness in result. Also the within variance is

significant indicating that experts like to see matches during which some players

show an outstanding performance.

Looking at the non-reported coefficients of the dummies reflecting the time in

the season and the year we get little significant effects, all in all confirming

that matches later in the season are not worse and that the competition did not

decrease in quality over time.

The adjusted R2 is about 0.2 for the objective variables and 0.3 for the

subjective performance evaluation indicating that explaining the quality of a

match is not an easy matter.

So far we assumed that a goal scored (or a yellow card received) by the home

team is the same as a goal scored (or a yellow card received) by an away team.

However, there are a number of reasons why home and away indicators could be

valued differently. First, it is a stylised fact that home teams are more likely to

win than away team. This might be the consequence of more incentives of the

11
This result is robust to including the strategy variables like the number of defenders and attackers on
the field or the difference in these variables.
home teams to win (because of the spectators) – more incentives lead to better

play, hence this results in more goals for the home team and hence a higher

likelihood to win. However, this better play also might mean that on average the

goals of the home team might be of better quality than the goals of the away

team. Hence, the coefficient of the home team goals should be bigger than the

coefficient of the away goals variable. Another reason would be that are

experts are biased towards the home teams – that too would imply that home

goals are valued more. One way to distinguish between these two explanations is

by looking at the ‘valuation’ of red cards. Assume that the referees are

unbiased, hence a referee will give a red card when the gravity of a foul exceeds

a specific threshold that is the same for both teams. In this case, biased

(towards the home team) experts will punish home red cards less. However,

higher incentives will not only lead to more creative effort but also to more

destructive efforts. Hence a home red card should on average be for a more

destructive foul than the away fouls leading to a red card.

Here again the Ramsey RESET test rejects clearly (at the 1% level) the null

hypothesis that the model has no omitted variables, indicating that the right

specification is probably combining both sets of variables (subjective and

objective).

Next distinguish home and away

By the way, check whether strategy at home and away are different – criticism

on referee effects in last minutes

IMPORTANT Q: do journalists choose which game to watch or are assigned?

This is important to see whether they are supporters or neutral observers

Ask for penalty!!! + minutes when goal!!!

References

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Bordeaux Wine", Cahier Scientifique de l'Observatoire des Conjonctures
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Chossat, V. and Gergaud, O. (2003) "Expert Opinion and Gastronomy: The Recipe
for Success", (with V. CHOSSAT), Journal of Cultural Economics, 27, pp. 127-
141.

Ginsburgh, V. (2003) "Award, Success and Aesthetic Quality in the Arts"

Journal of Economic Perspectives, 17(2), Spring, pp. 99–111.

Ginsburgh, V. and van Ours, J.C. (2002) "Expert Opinion and Compensation:
Evidence from a Musical Competition", The American Economic Review, 93(1), pp.
89-296, March.

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of Cultural Economics, 27, No.2, May 2003, pp. 81-126.