Comment on “Professional Asian Football Leagues and the Global Market”

Abstract

It is my great pleasure to comment on Szymanski (2016). Professor Szymanski has made several contributions to the field of sports economics, including the authoritative Handbook on the Economics of Sport (Wladimir & Szymanski, 2006), and has shown that he has expert knowledge on the economics of sports leagues (see Szymanski, 2012). Given his background, I assume that his omission of certain topics regarded as important to the field of sports leagues, such as revenue sharing and competitive balance, is intentional. My comments mainly relate to Japan-specific issues, and are intended to expand the scope of Szymanski (2016) as much as possible. First, Szymanski discusses the history of national leagues, which is important in understanding the structure of the Japan Professional Football League (J-League). The process of the J-League's establishment, which is discussed in detail in Itaba et al. (2011), suggests various implications for understanding the development of national professional sports leagues in general. It is noteworthy that the J-League was established based on a new concept for a professional sports league that was characterized by a home town system, a 100-year agenda, a supporter system, and positive relationships with lower level teams. In this sense, J-League is regarded as a “package-type innovation.” Saburo Kawabuchi, the first chairman of the J-League, led this innovation by turning away from what he felt was the negative example of Japan's professional baseball league, and rather aiming toward the ideal of developing sports culture via the development of football. The most important implication from the success of the J-League is that the establishment of a new sports league needs a new concept. Otherwise, the necessary large-scale shift of fans from existing professional sports to the new professional sport will not come to pass. Examples of such failures in new sports leagues are the Japan Volleyball League and the Japan Basketball League. Second, Szymanski (2016) states that “[o]ne feature of the football world that is striking is the simultaneous interest in national team/international competition and club/league competition.” (p. 3). In the case of the J-League, the top priority was a World Cup victory. This created the image that the J-League is geared toward not only domestic competition, but also competition at the international level. This image stimulated a sense of nationality and raised enthusiasm for both domestic and international competition. This characteristic is quite different from the Japan Professional Baseball League. A discussion of the optimal strategy for balancing national league competition with international competition would likely yield some valuable insights. My third comment concerns the regression analysis on the relationship between players' salaries and their performance. I strongly agree with Szymanski's finding that salary is closely related with performance via the trades of players who perform well. However, there is another type of micro-foundation for the relationship between performance and salary. Whether a team should employ a star player with high performance but at high cost is not a straightforward decision. There exists a choice between a strategy of purchasing star players and cultivating them, depending on a team's financial situation. The case of Consadole Sapporo (Japan Football League) in 2003 was a case of a failed “purchasing star players” strategy, and the team experienced a serious financial crisis after purchases of star players that did not lead to any improvement in the team's performance. This implies that there is a possibility that outliers in the regression analysis are not statistical errors, but rather reflect differences in strategy. Lastly, Szymanski states that the competition with other sports has various effects on the development of the professional football league. Obviously, there is competition for sponsorship and fans, and the existence of competing sports is a serious obstacle to the development of the league. As discussed earlier, when the Japan Football League was established, it took a different strategy from professional baseball, especially in the style of the linkage between community sports and sponsorships. Since the J-League established an innovative system in professional sports, a large number of sports fans shifted from baseball to football. In this sense, there was strong substitutability between the different professional sports. The question is whether or not there exists complementarity among the professional sports. Theoretically, a variety of professional sports increases the overall interest in professional sports, expanding the professional sports market as a whole, especially when their high seasons are different. If a complementarity effect exists, the possibility of cooperation among different field of professional sports arises. I would be interested in knowing how Szymanski views this possibility of complementarity. In conclusion, Szymanski presents some important implications for understanding the structure of Asian sports league with rich information.