speri.comment: the political economy blog

Is there a political economy of football?

Football often likes to see itself as a world apart from society and politics, but it is susceptible to political economy analysis

Wyn Grant, Emeritus Professor of Politics at the University of Warwick and a fellow of the Academy of Social Sciences.

Wyn GrantThe ‘world of football’ and ‘football people’ are terms often used in discussions of the game of football.   They signify a wish for football to regulate itself and to deal as little as possible with societal forces outside the game.   However, given the importance of football economically and socially this stance is becoming more difficult to maintain.   There is both an opportunity and a need to deploy a political economy toolkit to analyse the game of football, even if we accept the special characteristics that football claims to exhibit. Exactly which political economy toolkit depends on one’s stance, but the focus here is on the interaction between technology, market structure and regulation. Football has long been resistant to the use of new technology.   Floodlights transformed the game in terms of when it could be played, but their adoption was relatively slow.

Recently, it has taken a long time to adopt goal line technology, despite the fact that equivalent technologies have been used in other sports. Although football has generally been truculent in the face of new technology, one technological innovation really has transformed the game: that of satellite broadcasting.   It has created a new financial dynamic in the game and created a situation in which ‘followers’ become more important than ‘fans’. Satellite broadcasters need content that attracts and retains subscription payers.

Blockbuster movies can be bought on DVDs or downloaded.   Live sport is a very good seller of subscriptions, particularly to key demographics for advertisers, such as young males. It is satellite broadcasting that has created the riches of the English Premier League.   The price paid has been forced up again next season by the fierce contest between BSkyB and BT Vision.   What really worries BT is Sky undermining its broadband market.  Having live football content is a way of fighting back against Sky. Market structure has also changed.   It needs to be recognised that there have always been big clubs and that the local (invariably male) businessmen that owned them were often wealthier than was suggested by the homespun image they often cultivated.   Even so, satellite broadcasting and globalisation have transformed the game. The big growing market for Premier League football is now in Asia, in part because of its attraction for gamblers.   And, as middle-income households grow in Africa, that market is going to become more important as well. Clubs like Manchester United, acquired by the Glazers through a leveraged buy-out, sell their merchandise across the globe.   They have sponsorship contracts tailored to each national market – including a paint sponsor, for example, from Japan. Foreign investment in the game has grown.    Most football clubs run at a loss and the only way you can make money is through capital appreciation, itself hazardous.   Most foreign investors are prestige-driven, trophy investors.  Roman Abramovich has spent £1 billion on Chelsea and he cannot expect to get anything back, but it is a small dent in his fortune. There is a dark side to globalisation.

Talented players move from Latin America and Africa to Europe, although in the case of Latin America the trend appears to be slowing.   In the case of Africa shady intermediaries engage in a form of human trafficking. Steps are being taken to regulate the wealth in the game, in part because clubs do not want to see increased television revenues going to players and agents.   But regulation can be used by existing dominant players in a market to protect their positions.   To an extent that is what is happening with both Uefa’s financial fair play regulations and the Premier League’s own new regulations.   Both sets of regulations need to be tested in implementation. Nevertheless, it may be that transfer fees and player wages have peaked in real terms.   A growing supporters’ movement seeks to see fans run clubs.  But it is difficult to see a Premier League club being run in this way and there is plenty of potential for tension between the expectations of fans and the professionals who run such clubs on a day-to-day basis. The state has been very reluctant to get involved in football, although the European Union has been more active than its member-states.   This creates a tension between EU notions of solidarity and the market ethos of much of football.   But the truth is that in many respects football is a highly distorted market which bears all the hallmarks of ‘crony capitalism’.

About the author

Professor Wyn Grant joined the Department of Politics and International Studies at the University of Warwick in 1971 and was chair of department from 1990 to 1997. In 2010 he was presented with the Diamond Jubilee Lifetime Achievement award by the Political Studies Association. He was elected an Academician of the Academy of Social Sciences in 2011. Visit his political economy of football blog for more information on this topic: http://www.footballeconomy.com/.

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Categories: Political theory, SPERI Comment, Sport | 3 comments

Articles and comments posted on this blog reflect the views of the author(s) and not the position of SPERI or the University of Sheffield.

Comments (3)

  1. Great piece Wyn. I’ve often thought that a serious political economy analysis of football is long overdue. Every year we see the Deloitte reports and the acres of newsprint devoted to the game, but very little on the deep structural forces shaping it. And there’s lots for IPE/PE people to get animated about, surely: global governance issues with UEFA/FIFA and the clubs themselves; the essential unsustainability of the clubs, the globalisation of the fanbase, and issues of modern slavery/ownership and human trafficking (three things you rightly draw attention to here); the enormous power that the football proletariat, the players, have vis-a-vis the bosses; and the list goes on… Is it time, then, for IPE to take football – and global sport as a whole – a lot more seriously as a theme of study?

    And on a minor note, just today UEFA have announced that the Europa Cup winners will get passage to the Champions’ League from next season, and they’re also contemplating giving the fifth placed team in the big leagues a spot too. But what about the FA Cup winners!?

  2. The most important thing in relation to the political economy of football, is to recognise that football clubs are first and foremost, social and civic institutions. They are integral features of the social fabric of the communities in which they are located: integral to the identity, moods, emotions, and well being of communities. All of which means they are far too important to be left to the vagaries of the market. Vital social and civic institutions cannot be run by one individual or small groups of individuals, and that is the outcome the market is currently delivering. Football, including top level football, needs to be taken out of the market. This of course is a moral political economy argument. On a personal level I wanted to see my football club nationalised, when it was briefly 85% owned by the Treasury and sold back to the people that make and define the club, on a bit by bit basis. Instead we have inherited more distant want to be master of the universe figures who simply view their asset as a commodity. Football clubs are too important to be run for the personal enrichment of individuals and to fall prone to their whims and misjudgements, and a civilised society would recognise this. Which is why the rest of the world could learn useful lessons from Germany, but probably wants to avoid the cronyism of state aid that prevails in Spain. Fan ownership is the logical conclusion, of such a mode of thinking and the only sustainable future for football. Yes, – football clubs can be run as global businesses but every penny of earned revenue needs to be reinvested in the club and the communities which built them. At a lower level Chester FC and Wimbeldon FC, fan been fan owned trail blazers as pheonix clubs. Political forces and coalitions in favour of this kind of model have been being assembled for some time. The Spirit of Shankly organisation has precisely these goals and has membership of over 10,000. We won the argument over Hilsborough and we will win the argument over this. To misquote a famous Irish Republican, “We are not going to go away, you know.” The post is right that the game is rotten, but there is also a sea change afoot and a change in public moods that has to be capitalised on.

  3. Pingback: Is there a political economy of football? « Politics@Warwick

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