Aston Villa and Wolverhampton Wanderers 1971/2 to 1981/2: A Study of Finance Policies in the Football Industry

Abstract

The football industry is a most unusual one. Football clubs, unlike most other organisations, need to cooperate in order to provide a saleable product, a game. Companies can only enter the industry with the specific approval of those already within, and this approval is rarely given since it leads to the expulsion of existing members. The industry requires that less successful clubs be cross‐subsidised and restricts the payment of directors' fees and dividends. Until 1981/2 a minimum admission price was also stipulated. Such supportive measures contrast sharply with the nature of competition on the field of play in which there can be ‘only one winner’. The pursuit of playing success as a dominant objective means that few can ‘succeed’ in any one season, whereas in industries in which orthodox financial objectives are important several firms may succeed simultaneously.