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Introduction
The financial situation in the football industry and the risk of bankruptcy of some of its organisations was a point of concern to establish financial control standards to introduce more discipline and more rational spending. The football business experienced a significant growth during decades expressed with enhanced revenue streams mainly attributed to the re-organization of the big football leagues (England, Spain, Italy, France and Germany) during the 1990s, the expansion of European competitions and intense media interest and coverage (Dimitropoulos and Tsagkanos, 2012), along with the internationalization of product markets, the television broadcasts, and other related products (Nauright and Ramfjord, 2010).
Since the implementation of financial fair play (FFP) regulations, many authors have tried to investigate the effects of this regulation have had on the competitive balance in sporting terms in the different European leagues. Financial data show that European football has experienced a quick financial recovery and further polarization with a continuous improvement since the year 2012 (Franck, 2018). However, we know less about its influence on the competitive balance from a long term perspective.
In this context, the main purpose of this paper is to examine the impact of the FFP rules utilizing a broad study of 17 European leagues. Thus, our study provides an important contribution to the literature on the impact of specific regulatory interventions in the football industry. Most of the work analyzing the effects of the FFP (Peeters and Szymanskyi, 2014, among others) focuses on the global analysis of the main European leagues without analyzing the internal behavior of these leagues or the competitions of other European countries. However, it is necessary to bear in mind that significant differences exist between many of Europe's football leagues and therefore FFP regulations could potentially affect individual leagues in very different ways, so that it is important that more research is conducted in this area to discover the impact of FFP throughout Europe (Freestone and Manoli, 2017). On this same line, Plumley et al. (2019), pointed out that previous research examining competitive balance in European football has almost exclusively focused on the aforementioned “big five” leagues (England, France, Germany, Italy and Spain). Therefore, it is also interesting to analyze the behavior of other leagues, as described in the following sections.
“Financial...