Soccer financials

A couple of years ago I had lunch with Roger Noll in London on one of his visits to the LSE and we talked about the availability of financial data in sports. We both agreed that anyone researching English soccer is incredibly blessed to have full public accounting records for all the teams going back at least 40 years, and in some cases back as far as 1907! The reason for this is an oddity of British law, which requires all limited companies to file annual accounts open to public inspection, even if the shares are privately held and not traded on any stock market. Moreover, so far no English clubs have been absorbed into larger commercial organisations with all the potential to hide information and conceal profit in ways that Rod Fort and others have documented so well. Hence the accounts of English clubs are really very informative on issues relating to revenues, costs and cashflow. So much so that Deloitte’s have been publishing a summary of the accounts for the 92 professional English since 1992 and the latest edition, covering the accounts for the year 2003/04 was published in June.

Deloitte’s summary is very helpful, since they not only report the data on a consistent basis across clubs, they also provide some useful analysis of the data. Unfortunately, they also now charge for the report, although I suspect academics can get it for the reduced student rate of £30 on request. Alternatively, if your library has access to databases such as FAME, you can download the full accounting records yourself. In fact, this website also has a page of football finance related sites here. I have posted some earlier summary versions of the accounting data that I have collected on my own webpage, and plan to do so again when I have got used to my institution’s new website (!). Perhaps I should send it to Rod to post on his site.

I have used this data extensively in my research, and indeed, I doubt that I would ever have become involved in sports economics had it not been for the availability of this data, but I think it remains remarkably underutilised in sports econ research. That’s why I remember Roger telling me that once American economists got wind of this data, they would enter the market and we would see an explosion of papers using the data. As yet this hasn’t happened- but I think it would be no bad thing if it did.

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Author: Stefan Szymanski

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