Do government subsidies of sports cause athletes to be paid more than they would earn in a free market?
I’ve wondered where the FA’s get the money given as prizes.
Not necessarily. Perhaps, in a free market they would be paid more. Nevertheless, the market is certainly distorted.
It has often been alleged that in the modern world the first athletes to get “subsidized” were the members of the Soviet ice hockey team at the 1972 Winter Olympics. Back then Olympics were only open to amateur athletes so the Soviets circumvented the rule by giving professional hockey players phony jobs, mostly in the Red Army, and claiming they were nothing more than extremely skilled amateurs. True or not it’s obvious sportsman are one of the categories who get the most generous subsidies in the modern world.
Think about infrastructures. How many stadiums are built using entirely private funds? Who provides security during events (especially when notoriously troublesome football supporters are involved)?
Then think about the athletes themselves. Leaving aside those taking parts in very popular disciplines (football, basketball, rugby and cricket in some countries etc) do you think someone in his right mind would pay a person a full time salary to train in a little known discipline and do little else? I don’t know how the situation is in the US and Canada, but in Europe (and particularly in some countries like Italy and France) sportsmen can live quite confortably at taxpayers’ expenses. A usual trick is to either give them subsidies through the national Olympics committee to “fund their training” or, even worse, give them a cushy government job. As you may guess law enforcement jobs seem to be a particular favorite. Do you ever see these athletes wearing a uniform and patrolling a street? That would take away time from their training, so you are very unlikely to be pulled over and fined by an Alpine ski bronze medal winner.
And all of this to further XIX century style jingoism…
I think IP might have a lot to do with it. A huge amount of the money in sports is TV money. Without IP I’m not sure how live broadcast rights would work. The format might have to switch to some sort of protected PPV format.
It is not known if the athletes themselves would be better or worse off in a truely free market. We can say with certainty that owners who depend on the subsidies would be worse off.
TV rights are not IP right? Surely if you rent a stadium and organize a match you get to decide who can enter with a TV camera. It’s the same as saying restrictions on Mises U are based on IP, it’s simply not true.
Edit: OK sorry, got it. You were thinking about the value a TV station could generate from a broadcast if not protected by IP. With all the piracy going on, the value of “live” broadcasting still seems to be considerable.
right now there is a bunch of ‘illegal’ streams of international footy matches that people watch in order to avoid paying for subscriptions or if the games aren’t available on any tv station. Without ANY IP laws, someone could take the feed and provide it for cheaper or at no cost and have it only be delayed by an extra second or two. But maybe TV broadcasters would figure out a better way to protect their product, I’m not sure. I think at a minimum it would decrease the profits as they would have to assume their own costs of ‘enforcing’ their IP. With less opportunity for profit, that ought to lead to smaller bids for rights and less money in sports in general. Same goes for if owners have to assume more stadium costs.
I don’t think European football league systems receive a lot of government funding. The FA, Serie A and La Liga are the three top football leagues most likely to default within the next two years. The predecessor of the United States’s MLS also defaulted, largely becuase of extravegant spending, and poor calculation of future profits.
A PPV format would work wonders. There are not many people who would wait a day or two later to watch a sporting event.
I would guess athletes would be worse off monetarily. IP creates markets for items that normally would not have such a big market. It’s a cartel. To say the free market will do “everything” better than this unbalanced economy is a little short-sighted. It would be more balanced, money will flow properly.
The FA is not a league.
The predecessor to the United State’s MLS could default because it was a closed cartel. The leagues in Europe are not cartels but consist of clubs independent of each other. The leagues can not go bankrupt, only the clubs that participate in them can - and do all the time in some leagues.