More on Football and Globalization

Dani Rodrik has a good follow-up post on globalization and football. Among other worthwhile links, he points to a paper in the August Journal of Finance (you have to pay to read it, but can see the abstract for free) which appears to show that national team losses lead to declining stock markets. (Economists: is there anything they can’t claim to have proved?) More soberly, Rodrik points out that the most interesting open question right now is about the quality of domestic league play in countries who lose most of their star players to Europe. Does football in these countries suffer as a result of exporting talent, or do European investment and the influence of superstar role models drive up the quality of the game? Rodrik argues, rightly, that Latin America is the best place to look for this.

Where I think we still need work is on the quality of domestic league play in countries which export most of their star players. As some commentators pointed out, Latin America is the right testing ground for this (in view of the pervasiveness of the phenomenon and the better data), and one can look at stadium attendance, value of TV contracts, or ticket prices as indicators of trends in quality. Whether on balance the average Brazilian or Argentinean soccer fan is better off or not seems to me to be an open question.

But can we so simply assume that stadium attendance and ticket prices indicate trends in quality? Or are those numbers bound to be influenced by other factors—for instance, the fluctuating intensity of the (frequently extreme) local rivalries and the success or failure of particular marketing campaigns? Further, it seems impossible to determine “whether on balance the average Brazilian or Argentinian soccer fan is better off” without in some way examining the problems of corruption and violence that continue to undermine the Latin American leagues and sabotage the experience for many fans. Are these problems exacerbated by European money under the current system? Might they affect match attendance and ticket prices in a way that has nothing to do with the quality of play?