The Econometrics of Sport

The Econometrics of Sport

New Horizons in the Economics of Sport series

Edited by Plácido Rodríguez, Stefan Késenne and Jaume García

The study of sport in the economy presents a rich arena for the application of sharply focused microeconomics, macroeconomics and econometrics to both team and individual outcomes. This unique book offers a survey of recent research that follows the tradition of empirical and theoretical analysis of sport economics and econometrics.

Chapter 8: Estimation of temporal variations in fan loyalty: application of multi-factor models

Young Hoon Lee

Subjects: economics and finance, econometrics, sports


Sports attendance has been the subject of extensive study in the sports economics literature (Noll, 1974; Siefried and Eisenberg, 1980; Humphreys, 2002; Schmidt and Berri, 2004; Krautmann and Hadley, 2006; Poitrasand Hadley, 2006; Ahn and Lee, 2007; Krautmann and Berri, 2007; Leeand Fort, 2008). Many studies have centered on the testing of the uncertainty outcome hypothesis. For example, Lee and Fort (2008) categorized uncertainty of outcomes into game uncertainty, playoff uncertainty and consecutive season uncertainty, and presented empirical evidence that the attendance of fans of Major League Baseball (MLB) is sensitive to changes in playoff uncertainty, but not to other types of uncertainty. Inelastic pricing has also been studied fairly extensively (Fort, 2004; Ahnand Lee, 2007; Krautmann and Berri, 2007). It is expected that sports teams will set their ticket prices in elastic regions, as most sports teams are local monopolistic firms.

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