This paper analyzes the risk-taking behavior of heterogeneous players in dynamic contests with intermediate information. Using data from the first German Handball league, we measure risk-taking by substituting the goalkeeper for an additional field player. By differentiating between ex-ante and in-game heterogeneity, we show that underdogs and trailing teams are willing to take more risks and that favourites and underdogs react differently to interim information. Trailing underdogs choose riskier strategies than trailing favorites during a match. The increased overall risk-taking is indeed beneficial for underdogs, whereas favourites lose significantly more games as a result of increased risk-taking.

This paper analyzes spillover effects from previous matches against the future champion of a league. Using data from 78,264 European football games, the empirical results from a matching method show that favourites in the current match gain significantly fewer points after a match against the future league champion. By contrast, underdogs benefit from such a match, as they gain significantly more points. By considering shadow effects in the analysis, these results suggest that favourites put more effort into the match against the future champion and lower their effort level in the next match, which explains the negative spillover effects. As there are no significant shadow effects for underdogs, the positive spillover effects might be caused by positive 'learning-by-doing' effects. A subsequent logit regression using betting odds as control variables confirms the existence of the observed spillover effects.

In this paper, football clubs are modeled as value‐maximizing enterprises. With a long‐term perspective in this framework, players are not only factors of production, but also assets of the club. It is shown that talent investment is higher with value‐maximization than with profit maximization for homogeneous football clubs. Club heterogeneity is then modeled by different time‐horizons regarding future profits, which leads to asymmetric levels of talent investment. Teams with longer time‐horizons demand more talent and tilt the competition to their favor. Increases in transfer prices for players worsen the competitive balance, while higher player wages improve it.

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