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Gambling with Public Money: An Economic Analysis of National Sports Team Funding

Published online by Cambridge University Press:  01 January 2023

Heather Mitchell ,
Heath Spong  and
Mark Stewart
Heather Mitchell
Affiliation:
School of Economics, Finance and Marketing, RMIT University, Melbourne, Australia
Heath Spong
Affiliation:
Department of Economics and Finance, University of Western Sydney, Sydney, Australia
Mark Stewart
Affiliation:
Department of Economics and Finance, University of Western Sydney, Sydney, Australia
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Abstract

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Many governments across the world provide extensive funding to national sports teams and individual athletes in pursuit of success at international competitions such as the Olympic Games. One factor that motivates governments to fund national sports teams is the potential to exploit the elevation in nationalistic pride that attends international sporting success. Drawing on research in the psychology of sport, this article contends that politicians can access the ‘reflective glow’ of successful athletes for their political benefit. The statistical correlation between government funding and Olympic success is explored using the basic prisoners’ dilemma to represent the decisions of two governments competing for sports success. While the analysis is simple, we argue that it sheds some light on recent examples and represents a first step in understanding this complex issue.

Keywords

D72L83Game theoryInternational sports fundingpolitical opportunity costOlympic Games
Type
Symposium
Information
The Economic and Labour Relations Review , Volume 23 , Issue 2: Sport Economics , June 2012 , pp. 7 - 22
Copyright
Copyright © The Author(s) 2012

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