Closed league

Last updated

In sports, a closed league is a type of sports league where the number and identity of the teams taking part in the sports league activities does not change from year to year due to the performance of the member teams. A closed league is the opposite of leagues with promotion and relegation systems (often referred to as open leagues) where teams can be sent down to lower leagues if their performance is poor enough. Closed leagues are the most common form of sports leagues in North America and are also a common form of sports league in Australia and Singapore. [1] Motorsport series such as Formula one have also been described as closed leagues. Closed leagues are sometimes considered a form of sport monopoly or cartel. [2]

Contents

Development

Closed leagues developed in North America during the 19th Century because of the distances between cities, with some teams separated by half of the North American continent, resulting in high traveling costs. The National League of Professional Base Ball Clubs was established in 1876, and its founders determined that they must make baseball's highest level of competition a "closed shop", with a strict limit on the number of teams, and with each member having exclusive local rights. This guarantee of a place in the league year after year would permit each club owner to monopolize fan bases in their respective exclusive territories and give them the confidence to invest in infrastructure, such as improved ballparks. This in turn would guarantee the revenues needed to support traveling across the continent. [3]

In contrast, the shorter distances between urban areas in England allowed more clubs to develop large fan bases without incurring the same travel costs as in North America. When The Football League, now known as the English Football League, was founded in 1888, it was not intended to be a rival of The Football Association but rather the top competition within it. The new league was not universally accepted as England's top competition right away. To help win fans of clubs outside The Football League, a system was established in which the worst teams at the end of each season would need to win re-election against any clubs wishing to join. The rival Football Alliance was then formed in 1889. When the two merged in 1892 it was not on equal terms, with most of the Alliance clubs being put into new Football League Second Division, whose best teams would move up to the First Division in place of its worst teams. Another merger with the top division of the Southern League in 1920 helped form the Third Division in a similar fashion, firmly establishing the principles of promotion and relegation. [3]

Common features

Revenue sharing

Closed leagues often feature a form of revenue sharing, where forms of revenue are shared equally by all teams, regardless of team performance or a team's number of supporters. [4]

Salary caps

Closed leagues often feature salary caps in order to control labor costs and create a more level playing field among its competitors by preventing rich teams from paying the best players salaries that poorer teams cannot match. Salary caps can be "hard", in which case they cannot be circumvented, or "soft", where teams may go over the salary cap in certain cases, but may be penalized financially for doing so. [5] [6]

Draft

Closed leagues often feature drafts to assign new talent and promote competitive parity by giving teams with good records late picks in the draft while poor performing teams benefit by having good early picks to select talent. Often, closed leagues have a draft lottery to discourage tanking. [7]

Debate

Closed league systems have been subject to debate over whether the system creates better and more fair competition in comparison to open leagues, and whether they are more financially viable.

Arguments for

Proponents for closed leagues often argue that this system leads to more financially stable and profitable teams and creates less risk for owners due to teams not needing to spend money in order to stay competitive to avoid relegation to a lower league or qualify for tournaments. The world's ten most valuable sports teams are American teams playing in closed leagues. In addition, proponents of closed leagues also argue that the system creates more competitive balance in a sports league, because teams cannot "buy" a championship and because there is less of an imbalance between the richer and poorer teams in the league, while not impacting the skill ceiling that the league hopes to achieve. [8]

Arguments against

Opponents of closed leagues argue that there are more games where something is "at stake" in a promotion and relegation structure, which could increase interest in the league's games. In addition, opponents argue that a closed system leads to teams tanking in order to receive better draft picks. Opponents also argue that a promotion and relegation system increases competition in the different levels of the sporting pyramid, which can further player development and lead to more ambitious strategies from team owners. [9]

See also

Related Research Articles

In sports, a division is a group of teams who compete against each other for a championship.

<span class="mw-page-title-main">Victorian Football League</span> Australian rules football league

The Victorian Football League (VFL) is an Australian rules football competition in Australia operated by the Australian Football League (AFL) as a second-tier, regional, semi-professional competition. It includes teams from clubs based in eastern states of Australia: Victoria, New South Wales and Queensland, including reserves teams for the eastern state AFL clubs. It succeeded and continues the competition of the former Victorian Football Association (VFA) which began in 1877. The name of the competition was changed to VFL in 1996. Under its VFL brand, the AFL also operates a women's football competition known as VFL Women's, which was established in 2016.

The National League is an association football league in England consisting of three divisions, the National League, National League North, and National League South. It was called the "Alliance Premier League" from 1979 until 1986. Between 1986 and 2015, the league was known as the "Football Conference".

Premiership Rugby, officially known as Gallagher Premiership Rugby, or the Gallagher Premiership for sponsorship reasons, is an English professional rugby union competition, consisting of 10 clubs, and is the top division of the English rugby union system.

In professional sports, a salary cap is an agreement or rule that places a limit on the amount of money that a team can spend on players' salaries. It exists as a per-player limit or a total limit for the team's roster, or both. Several sports leagues have implemented salary caps, using them to keep overall costs down, and also to maintain a competitive balance by restricting richer clubs from entrenching dominance by signing many more top players than their rivals. Salary caps can be a major issue in negotiations between league management and players' unions because they limit players' and teams' ability to negotiate higher salaries even if a team is operating at significant profits, and have been the focal point of several strikes by players and lockouts by owners and administrators.

<span class="mw-page-title-main">Promotion and relegation</span> Process where teams are transferred between divisions

In sports leagues, promotion and relegation is a process where teams can move up and down between multiple divisions arranged in a hierarchical structure, based on their performance over a season. Leagues that use promotion and relegation systems are often called open leagues. In a system of promotion and relegation, the best-ranked team(s) in a lower division are promoted to a higher division for the next season, and the worst-ranked team(s) in the higher division are relegated to the lower division for the next season. During the season, teams that are high enough in the league table that they would qualify for promotion are sometimes said to be in the promotion zone, and those at the bottom are in the relegation zone.

A sports league is a group of individual athletes, sports teams or clubs who form a league to compete against each other and gain points in a specific sport. At its simplest, it may be a local group of amateur athletes who form teams among themselves and compete periodically, at its most complex, it can be an international professional league making large amounts of money and involving dozens of teams and thousands of players.

<span class="mw-page-title-main">Bundesliga</span> Association football league in Germany

The Bundesliga, sometimes referred to as the Fußball-Bundesliga or 1. Bundesliga, is a professional association football league in Germany. At the top of the German football league system, the Bundesliga is Germany's primary football competition. The Bundesliga comprises 18 teams and operates on a system of promotion and relegation with the 2. Bundesliga. Seasons run from August to May. Games are played on Fridays, Saturdays and Sundays. All of the Bundesliga clubs take part in the DFB-Pokal cup competition. The winner of the Bundesliga qualifies for the DFL-Supercup.

The 2004–05 NHL lockout was a labor lockout that resulted in the cancellation of the National Hockey League (NHL) season, which would have been its 88th season of play.

<span class="mw-page-title-main">RFL Championship</span> Second level of British rugby league

The Rugby Football League Championship, is the second highest division of rugby league in Britain after the Super League.

Semi-professional sports are sports in which athletes are not participating on a full-time basis, but still receive some payment. Semi-professionals are not amateur because they receive regular payment from their team, but generally at a considerably lower rate than a full-time professional athlete. As a result, semi-professional players frequently have full-time employment elsewhere. A semi-pro player or team could also be one that represents a place of employment that only the employees are allowed to play on. In this case, it is considered semi-pro because their employer pays them, but for their regular job, not for playing on the company's team.

<span class="mw-page-title-main">Yokohama FC</span> Japanese football club

Yokohama Football Club is a Japanese professional football club based in Yokohama, Kanagawa Prefecture, part of the Greater Tokyo Area. The club was formed by fans of Yokohama Flügels as a protest against Flügels' merger with Yokohama Marinos in 1999, becoming the first supporter-owned professional sports team in Japan. They are set to play in the J2 League from 2024, the second tier of football in the country, after relegation from J1 League in 2023.

Professional sports leagues are organized in numerous ways. The two most significant types are one that developed in Europe, characterized by a tiered structure using promotion and relegation in order to determine participation in a hierarchy of leagues or divisions, and a North American originated model characterized by its use of franchises, closed memberships, and minor leagues. Both these systems remain most common in their area of origin, although both systems are used worldwide.

In sports, parity is participating teams having roughly equivalent levels of talent. In such a league, the "best" team is not significantly better than the "worst" team. That leads to more competitive contests in which the winner cannot be easily predicted. The opposite condition, which could be considered "disparity" between teams, is a condition in which the elite teams are so much more talented that the lesser teams are hopelessly outmatched.

<span class="mw-page-title-main">Major professional sports leagues in the United States and Canada</span>

Major professional sports leagues in the United States and Canada traditionally include four leagues: Major League Baseball (MLB), the National Basketball Association (NBA), the National Football League (NFL), and the National Hockey League (NHL). Other prominent leagues include Major League Soccer (MLS) and the Canadian Football League (CFL).

<span class="mw-page-title-main">English Football League</span> League competition featuring professional association football clubs from England

The English Football League (EFL) is a league of professional football clubs from England and Wales. Founded in 1888 as the Football League, it is the oldest football league in the world, and was the top-level football league in England from its foundation until 1992, when the top 22 clubs split from it to form the Premier League. The Football League was rebranded as the "English Football League" (EFL) from the 2016–17 season.

In the terminology of professional sports in North America, teams are often said to be based not in a city but in a media market. The size of the media market is usually a good indication of the potential viability of a major league team. A small market team is likely to struggle to compete financially against teams from larger markets and may therefore also be outbid in the competition for top talent. This has led to calls for revenue sharing, luxury taxes, and / or salary caps in most North American sports leagues in order to ensure competitive balance or parity.

<span class="mw-page-title-main">Super League</span> British professional rugby league competition

The Super League is the top-level of the British rugby league system. At present the league consists of twelve teams, of which ten are from Northern England, reflecting the sport's geographic heartland within the UK, one from London and one from southern France.

Major League Baseball (MLB) has a luxury tax called the "Competitive Balance Tax" (CBT). In place of a salary cap, the competitive balance tax regulates the total sum of money a given team can spend on their roster. Salary caps are common across professional sports leagues in the United States. Without these measures, teams would not be restricted on the amount of money spent on players' salaries. Therefore, teams with greater funding or revenue would possess a competitive advantage in their ability to attract top talent via higher salaries.

Tanking in sports refers to the practice of intentionally fielding non-competitive teams to take advantage of league rules that benefit losing teams. This is a much more common practice in American sports that utilize closed leagues than in open sports leagues in other nations, which typically penalize poor performers using a promotion and relegation system, in which the worst teams after each season are sent to a lower-tiered league and replaced with that league's best teams. Relegation costs teams revenue and makes it more difficult for them to attract top talent, making tanking unfeasible. Tanking teams are usually seeking higher picks in the next draft, since league rules generally give the highest draft picks to the previous season's worst teams. Teams that decide to start tanking often do so by trading away star players in order to reduce payroll and bring in younger prospects. While the terms tanking and rebuilding are sometimes used interchangeably, there are differences between the two concepts.

References

  1. ↑ "Sports Bite | The North American vs the European Sports System". SportsBite. February 27, 2017. Retrieved April 21, 2021.
  2. ↑ Sag, Matthew; Haddock, David; Jacobi, Tonja (2013). "League Structure & Stadium Rent Seeking — the Antitrust Role Reconsidered". Florida Law Review . 65 (1).
  3. 1 2 Cain, Louis P.; Haddock, David D. (2005). "Similar Economic Histories, Different Industrial Structures: Transatlantic Contrasts in the Evolution of Professional Sports Leagues". Journal of Economic History . 65 (4): 1116–1147. doi:10.1017/S0022050705000422. S2CID   154506974.
  4. ↑ Vrooman, John. "Revenue Sharing: Quest for Certainty". my.vanderbilt.edu. Retrieved April 21, 2021.
  5. ↑ "What is a Salary Cap in Sports? | The University of Kansas". onlinesportmanagement.ku.edu. Retrieved April 21, 2021.
  6. ↑ Marcotti, Gabriele (May 27, 2020). "U.S.-style salary cap would fail in Europe's top soccer leagues. Here's why". ESPN.
  7. ↑ Nussbaum, Daniel (May 4, 2016). The Impact of Sports League Structure on Fan Welfare (PDF). Department of Economics (Thesis). Amherst College.
  8. ↑ Lee, John Jay (February 5, 2021). "Why Promotion and Relegation is Overrated and a Closed System is Far Superior". Urban Pitch. Retrieved April 21, 2021.
  9. ↑ Savir, Merav (March 28, 2019). "The case for, and against, promotion and relegation in American pro leagues". Sports Retriever. Retrieved April 21, 2021.
This page is based on this Wikipedia article
Text is available under the CC BY-SA 4.0 license; additional terms may apply.
Images, videos and audio are available under their respective licenses.