Football´s market failures

england-manager-sam-allardyce-press-conferencePoor Sam Allardyce. The Brexit manager who crashed landed on take-off. Poor both in terms of judgement (but at least he immediately quit, sparing us some nonsense about a game of two halves or moaning about the referee), and also his managerial record. Sam has form, 24% (with 4/17 honourable mentions) in the 2007 Stevens Report, somewhat less than his 39% career “winning” success rate during his managerial career, which -always on the decline – was achieved with seven clubs (Blackpool, Bolton, Notts County, West Ham, Blackburn, Newcastle and Sunderland), and included winning the old third division and two promotions during the past ten years. Not that there is anything wrong in being a steady journeyman professional, nor working with some fine English clubs. But the lack of any international experience should perhaps have shown up in the England manager selection criteria…

The Guardian´s Simon Jenkins makes the point about self-regulating autonomous global sporting associations´ poor governance fueled by TV money.

I cannot take seriously sports I used to love when I cannot trust what I see before my eyes. I was baffled at the reason for last-minute player substitutions in football matches, until I was told these were fee-sharing deals. Cricket’s dropped catches and no-balls turned out to be paid for. British cyclists who suddenly won gold medals had superior equipment to other competitors. How did Qatar get to hold a summer World Cup, or Russia a winter Olympic games? You can guess. Are we soon to learn that referees are bribed for the inexplicable penalties that decide most rugby matches?

Is the root of the game´s problems actually the clubs´ ownership of players? What other business owns and trades its employees? In professional European football restricting the free movement of players is justified in order to ensure fair competition, but in practice the increasing value of transfer fees is resulting in a monopoly in terms of sporting success by elite clubs (see The Economic and Legal Aspects of Transfers of Players). English football has a problem given its corruptible and corrupting nature. It has even given the English language its own word for bribes, a bung – payments by football agents to managers. The bribes also reflect the lack of transparency of the business model, shielded by owners´self-interest, and in turn the clubs´ banks, tax-advisers and accountancy firms plus their shareholders´ indifference. England´s interim manager, Gareth Southgate, puts it well. “There’s lots about the industry of football that I don’t like but it’s a sport I love“. It is about the fans, the majority of whom are working class supporters  who love the game.

Solutions: first, for professional football clubs, scrapping player ownership and replacing them with fixed contracts with transfer details registered (preferably online, including agents´fees, etc.); second, for the England job, let´s go radical. Let the fans pick the squad and the team. 500,000 football supporters selected their best England XI before the Euros and for the 2018 World Cup qualifiers. There are 3.9m players of the Fantasy Football League alone. There can be crowd sourcing for the manager too, note that here the lamented Sam was the third choice…

Alternatively, the best-qualified person for the job could be appointed.

And that would be Hope Powell. She played in four FA Women’s Cup finals plus winning a League and Cup double in 1996. She  was capped 66 times as a player, including the 1995 FIFA Women’s World Cup, scoring 35 goals as a midfielder. She was the youngest coach of any English national football team, and led the national team at the 2001, 2005, 2009 and 2013 UEFA Women’s Championships, including the final in 2009 where they lost to Germany, as well as reaching the quarter-finals of the Women’s World Cup in 2007 and 2011, and the Great Britain women’s Olympic football team in 2012. Plus she was the first woman to obtain the UEFA pro licence in 2003. Commitment and success.

UPDATE – Oct 13 

The latest England selection (with both the previous captains dropped).

england-ix

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Football environment

Euro 2008 kicks off this weekend and promises some intriguing group stage encounters (not least Holland v. Italy, Holland v. France, France v. Italy, Spain v. Russia, Czech Republic v. Portugal, and Germany v. Croatia). And the games can only get better in the following knock-out stages. Sometimes it is argued that this competition is stronger than the World Cup, insofar as the weather tends to be kinder both on players and pitches, and there are fewer weaker teams. In the betting, Italy, the current World Cup holders, are rated behind Germany and Spain, but this a competition that has a habit of producing unexpected winners – for example the Czechs (1976), Denmark (1992) and Greece – the current Cup holders – (2004). Part of me is backing Spain, part takes refuge in Eduardo Galeano’s sentiments (post) that it is enough to enjoy the game.

The reason that I’m cheering on the Spanish is, of course, that none of the British representatives have made it to the Euro 2008 finals, in the year in which two English teams contested the UEFA Champions League final and Rangers reached the UEFA Cup Final, and when 13% of the players taking part in Euro 2008 practice their trade in the Premiership. Of the 16 nations competing, only Italy & Russia do not have at least one current Premiership player in their squads. The globalisation of professional football is largely the consequence of the EU’s regulations on the free movement of labour: no amount of posturing by UEFA on the numbers of home players per team is going to be successful. Ironically in the Champions League final both Chelsea and Manchester Utd fulfilled Blatter’s ‘six-plus-five’ principle (which would limit a team’s “foreign” players to five).

The number of home-based players in each nation’s squads is shown the graph, and is contrasted with the number of all players in each country’s domestic leagues: 96% of Russia’s squad play in their domestic clubs (and 8% of all the players in the tournament play in Russia), whereas only one Croatian plays in Croatia (and no one else does). Unsurprisingly the big football nations – Germany, Italy, France & Spain – have a high percentage of domestically-based squad members as well as sharing a large proportion of foreign players in their respective leagues [Data source: BBC].

Will this make any difference to their chances of success? The second graph contrasts the current odds (from William Hill: 4-1 Germany; 11-2 Spain; 7-1 Italy, Portugal; 15-2 France; 12-1 Croatia, Holland; 16-1 Czech Republic; 22-1 Greece; 25-1 Switzerland; 28-1 Russia, Sweden; 40-1 Romania, Turkey; 50-1 Poland; 100-1 Austria) with the number of players in the finals who play in each nation’s leagues (thereby assuming that this is an indicator of performance). The relationship looks quite close – without getting drawn into any statistical tests – but the actual results are likely to depend upon the players’ form and the quality of management. Let us remember that during qualifying England made the fundamental error of promoting the #2: see post No Easy Matches.

The Premiership is probably the most international league in the world (in terms not only of players, but also sponsorship, worldwide tv coverage), and yet the overwhelming majority of the England team would most likely be drawn from the top four clubs (less if Arsenal is one of these). The question then – accepting the positive impacts of globalisation on British football – is how sustainable is the modern game given the clubs’ level of indebtedness and cost structures, and arguably the increasing inequalities between clubs, and the lower divisions. The issues is not about players’ nationalities, but rather the linkages between the advantages of globalisation and ensuring that domestic football can generate new talent and decent national teams (i.e the financing of domestic football, benefit-sharing arrangements and the “rules of the game” in the widest sense). Perhaps this is where the Germans, Italians, Spanish & French are doing better?

But there is a lesson here for the World Environment Day too: strengthening local capacities is the key to help countries lever to their advantage the benefits from globalisation. Both the agricultural and forestry sectors in developing countries have been relatively neglected by multilateral and bilateral donors. The success of efforts to create new carbon markets to support avoided deforestation will depend upon the quality of local institutions and knowledge to match initiatives and funding to tackle the drivers of deforestation whilst supporting farming systems. Implementing such environmental service programmes – and wider reforms needed to decarbonise the world’s economy – will be by necessity a step-by-step experimental process based on enduring partnerships, but one that has hardly begun:

Juan Bautista Alberdi, an Argentine constitutionalist and liberal, noted in 1837 that “Nations, like men, do not have wings; they make their journeys on foot, step by step.” Latin America, long susceptible to the utopian mirages of revolutionaries and caudillos and still not immune to them, has struggled to absorb this truth. But … durable mass democracies have emerged across the region…[Brazil’s] leadership in nonfossil fuels and the unparalleled biodiversity of its Amazon rain forest make it a natural leader in the 21st-century struggle with global warming. (NYT)

UPDATE: 25 June

The first graph shows the four semi-finalists came from the top-5 rated nations (which is better than the match makers managed). I’m sure that Eduardo Galeano enjoyed the romance of the plucky and skillful Turkish performance, as well as Richard William’s sympathetic sport writing – here