Spanish Football Clubs Finances: Crisis and Player Salaries

International Journal of Sport Finance, Vol. 5, No. 1, 2010

Posted: 15 Mar 2010

See all articles by Ángel Barajas

Ángel Barajas

University of Vigo - Faculty of Business Administration and Tourism; affiliation not provided to SSRN

Plácido Rodriguez

Universidad de Oviedo - Facultad de Economicas

Date Written: Fabruary 2010

Abstract

This paper shows the current financial situation of Spanish professional football. Different financial ratios are used in order to classify the financial position of the different teams. The study has been split between clubs in First or Second division. We also analyze the relationships between the size of market, team payrolls, and team performance. We demonstrate the financial problems created by the arms race that clubs have started for getting the most talented players for trying to get the best possible sporting outcome. The new Spanish Law for companies in financial distress has implied that nine clubs are technically insolvent and under administration. We have searched for possible explanations of that situation. Nevertheless, our financial variables do not explain the likelihood that a club goes into administration.

Keywords: Finance, player salaries, performance, financial distress, under

JEL Classification: G33, J30, M4

Suggested Citation

Barajas, Ángel and Rodriguez Guerrero, Plácido, Spanish Football Clubs Finances: Crisis and Player Salaries (Fabruary 2010). International Journal of Sport Finance, Vol. 5, No. 1, 2010, Available at SSRN: https://ssrn.com/abstract=1569552

Ángel Barajas (Contact Author)

University of Vigo - Faculty of Business Administration and Tourism ( email )

Campus as Lagoas
Ourense, Ourense 32004
Spain
0034 988368713 (Phone)
0034 988368923 (Fax)

affiliation not provided to SSRN

Plácido Rodriguez Guerrero

Universidad de Oviedo - Facultad de Economicas ( email )

Campus del Cristo, s/n
Oviedo, Asturias 33071
Spain

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