Freedom of Entry, Market Size, And Competitive Outcome: Evidence from English Soccer‪.‬

1. Market Size in Sports Economics Market size has been accorded central importance in the analysis of professional leagues. The two-team-league model of El-Hodiri and Quirk (1971), popularized in Quirk and Fort (1992) and still the framework for contemporary analysis, predicted that the larger market club would achieve a higher win-ratio. It had the incentive to hire more talent than the smaller club because greater success on the field could be more effectively converted to dollars where the customer base was bigger. In equilibrium, the superiority of the big club would be more marked, the wider the discrepancy in populations. Hence, the perceived problem of competitive imbalance in sports leagues came to be identified in the literature with the dominance of big city clubs.