Abstract
Previous research on professional football offer conflicting results regarding the impact of wage dispersion on team performance. However, the existing intra-league heterogeneity among clubs is overlooked and could be the reason for the diverging outcomes. The aim of this paper is to reanalyze this relationship having the clubs’ size as moderator. Payroll – which captures the financial strength – is used as proxy of club size. Ordinary Least Squares regressions with season and league fixed effects are employed. Dispersion is measured by three indexes for robustness check. The outputs confirm the quadratic relationship between wage dispersion and performance, but adding that identical levels of dispersion have different impact on football clubs according to their financial strength.
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