Indirect Evolution and Aggregate-Taking Behavior in a Football League: Utility Maximization, Profit Maximization, and Success

Abstract

An evolutionary model of European football was applied to analyze a two-stage indirect evolution game in which teams choose their utility function in the first stage, and their optimal talent investments in the second stage. Given the second-stage optimal aggregate-taking strategy (ATS) of talent investment, it was shown that teams may choose a mix of profit or win maximization as their objective, where the former is of considerably higher relevance with linear weights for profits, and is more successful in the utility function. With linear weights for profit and win maximization, maximizing profits is the only evolutionarily stable strategy (ESS) of teams. The results change if quadratic weights for profits and wins are employed. With increasing talent productivity, win maximization dominates in the static and in the dynamic versions of the model. As a consequence, it is an open question whether the commercialization of football (and other sports) leagues will lead to more profit or win maximization.

Environmental Factors and Stakeholders Influence on Professional Sport Organisations Engagement in Sustainable Corporate Social Responsibility: A South African Perspective

“…On the other hand, another respondent argued that their organisation's objectives included becoming one of the biggest brands nationally and internationally, thereby alluding to a profit maximising model. This response emphasises the argument presented by Prinz [100] that professional sport organisations can embrace both profit maximisation and utility maximisation in their management structure and incorporate socially inclined objectives in their management approach.…”

Value‐maximizing football clubs

“…Conventionally in the sports economics literature, football clubs either maximize profits or winnings (see, for instance, Késenne, 2007). In addition, there are several studies analyzing clubs maximizing utility (e.g., Dietl, Grossmann, et al., 2011; Dietl, Lang, et al., 2011; Madden & Robinson, 2012; see Prinz, 2019, for a dynamic analysis) as well as fan welfare (Madden, 2012). However, these approaches do not take into account that the success and even the survival of a club depend on more than a single time period.…”