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Handbook on the Economics of Professional Football

Handbook on the Economics of Professional Football

Elgar original reference

Edited by John Goddard and Peter Sloane

In this comprehensive Handbook, John Goddard and Peter Sloane present a collection of analytical contributions by internationally regarded scholars in the field, which extensively examine the many economic challenges facing the world's most popular team sport.

Chapter 25: Detecting corruption in football

James Reade

Subjects: economics and finance, sports


A football match is an example of joint production of output; the ‘peculiar economics of sport’ (Rottenberg, 1956) dictate that two separate teams compete against each other to produce the output – a sporting contest – in the context of a wider sports league. Football players, coaches and officials are contracted (or licenced) by sports leagues to participate in such contests, yet as is well known from the principal–agent literature, when agent (football players, coaches, referees) actions are unobserved by the principal (the sports league), the potential for hidden actions can affect outcomes (for a textbook treatment, see Milgrom and Roberts, 1992). Hidden action can be positive (for example training, conditioning), but can also be negative (cheating, or corrupt activities); in this chapter the latter is considered. Even amongst the seemingly narrow category of cheating, there are many distinct forms; Preston and Szymanski (2000) suggest three forms: sabotage (actions that increase the marginal cost of production for opponents), doping (use of prohibited performance-enhancing drugs) and match fixing (influencing one or both teams to arrange the outcome of a match). I review the literature surrounding corruption in football before considering one particular case of corruption in football, dubbed Scommessopoli, a series of betting-related scandals affecting lower divisions of Italian football in recent years. These scandals are match-fixing schemes, and I use the abundance of data surrounding football match outcomes, even at lower league levels, to investigate the episode further.

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