Monday, November 08, 2004

The Sports Economist--Sports, Globalization, and Protectionism

The Sports Economist has an interesting article looking at global competition in sports. The basic idea is that competition has become global. As Skip Sauer (the Sports Economist and Clemson Economics professor) writes:

Over the past century, the scale of sporting competition has increasingly moved from the local to the national and international stage. The great Brazilian soccer players no longer play in their home country, but for top teams in Europe. The best American talent plays there as well. Asian and European players now dot the landscape in American baseball, basketball, and hockey (should they ever get started again).

Now the astute reader might say, gee that is the same thing that has happened in business. No longer can you just be the best in your own small town, but rather competition has become global. This is true not only for manufacturing but even retailing. (EX. Wal Mart will very soon become a global retailer!)

Change does come with this increased globalization. For instance, in the business world, less efficient businesses do go out of business and there is a shift in how the work force is allocated. Similarly, in sports some long standing rivalries are no longer played. Again quoting the SportsEconomist:
The consequence of this form of globalization is that traditional, local-based competition faces serious challenges. This scenario has been played out before. Competition in intercollegiate athletics has become competition not so much against your local or regional rivals, but competition to gain a share of attention on the national stage, in a national market. The result: conference
expansion beyond a regional footprint has been the trend for the past thirty years or so.
The analogy between sports and business does not end there however. In each some do not like the increased competing and the changes that are being forced onto participants. While thankfully we do not see terrorists trying to block large conferences, there are some protectionism that tries to block the move towards globalization.
European soccer has to come to grips with these forces as well. UEFA currently mandates that its member clubs compete in domestic competitions. This rule precludes countries like Ireland and Switzerland from generating enough support
to field a team that can compete with the best on the continent.
And like protectionism in business, the loser is the consumer who no longer can watch the best players, but rather is entertained with watered down "local" competition.

I urge you read the whole article, it is worth the time!

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