GUEST EDITORS’ INTRODUCTION: SPORT AND PUBLIC POLICY

Abstract

The world of sport, ranging from professional and amateur athletics to individual participation in active recreation, contains a surprisingly broad and rich array of public policy issues. Towns, school districts, states, and nations invest in facilities small and large, from walking paths and tennis courts to the proverbial white elephant, the Olympic stadium. Cities tax the incomes of visiting players, and government agents test athletes for performance-enhancing drugs. Courts in America and the European Union (EU) face a stream of challenging cases, generated by the clash of the joint nature of sports competition with antitrust concerns. In this special issue of Contemporary Economic Policy, we bring together a selection of contemporary sports economics research that addresses these policy issues. Our aim is to provide researchers with a clear picture of the state of economic policy research in sport and to stimulate further research in this area. The approach to sports policy varies considerably across countries. In America, the links between policy and sport are generally viewed as weak at the national level even though profound differences in the organizational structure of sport in the United States relative to the rest of the world are rooted in the infamous 1922 Supreme Court decision in the Federal League case. In contrast, sport and public policy in Europe are matters of direct government interest at the national level. UK Sport, a unit of the British government's Department of Media, Culture, and Sport, has counterparts in many European countries, and the interest extends to the EU itself. Earlier this year, a special EU commission issued a white paper outlining a Pierre de Coubertin Action Plan for EU policy toward sport (de Coubertin is the architect of the modei n Olympic games). The policy issues dealt with by UK Sport--drug testing, funding of youth programs, and facility finance--are among the issues examined in this volume. These same issues are faced in the United States as well, of course, although the American approach is relatively decentralized. Indeed, this characteristic is one of the key factors responsible for the most well-known public policy issue in U.S. sport. The stadium subsidy game, in which the major professional sports auction off team locations to the highest bidder, is fundamentally shaped by the autonomous and competitive approach to sports policy among U.S. states and cities. Antitrust and sport represent a nettlesome policy issue on both sides of the Atlantic. The inherently cooperative nature of key elements in sporting competition--agreements on rules, schedules, and prizes among competitors are essential--creates a challenge for economists and the courts in handling antitrust claims. The antitrust decisions in the Federal League case in the United States, and the Bosman case in the EU, had far-reaching consequences on the organization of sport in their respective jurisdictions. Two leading scholars on the organization of sport and the role of antitrust, Stefan Szymanski and Stephen Ross, take a new tack in their paper here. Whereas discussion of the critical antitrust cases in sport has focused on horizontal agreements between competing entities, little attention has been given to vertical restrictions in the chain of production in professional sport. Szymanski and Ross argue that the network of contracts between teams and leagues is more complex than is traditionally considered and that vertical aspects of these contracts are critical elements for the organization and governance of sporting competition. Research on the role that sports can play in local economic development, and especially public subsidies for the construction and operation of professional sport facilities, constitutes a large, contentious, and important topic in sport-related public policy. Dennis Coates provides a thorough, up to date, and critical survey of this rapidly evolving literature. …