Experience Characteristics and Moral Hazard in Team Sports
In 1998 fourteen leading European soccer clubs established a loose coalition known as the G-14 after Media Partners, an Italian Media Company, promoted the idea to form an independent and hermetic European league following the American model. Today G-14 is organized as an association of 18 top clubs. Backed by the bargaining power that stems from the treat to form an independent league, G-14 decided in October 2003 to approach FIFA and UEFA and demand for a change of the traditional practice to release players to association games without compensation1. After FIFA President Sepp Blatter made clear in December 2003 that FIFA would not discuss the compensation issue with the clubs’ lobby group2 the conflict escalated. In April 2004 G-14 triggered an investigation into the world governing body of soccer by Switzerland’s competition commission. G-14 accused the Zurich-based FIFA of breaching Switzerland’s antitrust laws. The commission is now investigating if FIFA abuses its dominant position by nominating players to compete in competitions like the World Cup without demanding permission from the clubs. In addition to this, G-14 has announced further legal moves against FIFA and UEFA, like for example the intention to file a complaint with the European Court of Justice.3
KeywordsMarginal Cost Team Sport Participation Constraint Wage Structure Wage Cost
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