Are English football players overvalued?

Abstract

ABSTRACT It is often suggested by fans, the media, and football commentators that English players are over-valued and receive higher salaries than those of comparable players from different countries. This study examines whether the suggestion can be empirically substantiated. Using a unique database covering all of the European elite leagues, we show that there is an English player value premium of around 40% and a wage premium of 25%. Exploring the reasons for this phenomenon in a regression setting, we find that the excess valuation and salary differential can be partly justified by several factors. First, and most importantly, there is a higher value attributed and wages paid to players in the English Premier League (EPL); second, that English players are more likely to play as strikers than in other positions in EPL clubs; third, that their performance in some positions is somewhat better than the average of players from other nations; fourth, that there are fewer of them in the top European leagues, leading to a shortage in supply. There is, however, evidence that the higher valuation of English attackers and the higher salaries of English attackers and of English midfielders evades explanation by any of these groups of variables.