MOUNT SAINT MARY’S UNIVERSITY

School of Business

Business 329

The Business and Economics of Sports

Fall 2009

MWF 1:00 – 1:50

Academic Center Room 321

Recommended Reading

Fort, Rod. Sports Economics. Upper Saddle River, New Jersey: Prentice Hall, 2003.

Quirk, James and Fort, Rodney D. Hard Ball: The Abuse of Power in Pro Team Sports. Princeton, NJ: Princeton University Press, 1999.

Sheehan, Richard G. Keeping Score: The Economics of Big-Time Sports. South Bend, IN: Diamond Communications, Inc., 1996.

Zimbalist, Andrew Unpaid Professionals: Commercialism and Conflict in Big-Time College Sports. Princeton, NJ: Princeton University Press, 1999.

Office Information:

Office: 317 AC

Telephone: (301) 447-5396 x4068

Email: einolf@msmary.edu

Click link for Office Hours

Course Objectives

The objective of this course is to allow a student to examine the economic relationships surrounding professional and inter-collegiate sports in the United States. By the end of the semester, a student will:

	Develop a business plan for a professional sports franchise;
	Understand the market forces that shape professional leagues;
	Manage a professional sports franchise through a number of economic environments, including salary caps, revenue sharing, insurance contracts, expansion, and stadium/arena financing;
	Realize the factors that determine player compensation in professional leagues;
	Understand bidding strategies in a free-agent market;
	Explain the relationship between economic forces and competitive balance in professional sports;
	Understand the economic impact of athletics on Mount Saint Mary's College and the effects of Title IX as a legal requirement;
	Understand the public and private interests of stadium/arena financing.

This course will satisfy the following objectives of the Undergraduate Program:

Students will comprehend and skillfully employ quantitative reasoning

Students will complete an undergraduate major (this course is an elective for the Business Major)

Students will connect this learning in this course with learning from the core and their major

To view the Goals and Objectives of the Undergraduate Program click here

This course will also satisfy the learning objectives of the Business Major

To view the Learning Objectives of the Business Major click here

To examine a spreadsheet that details how each of the assignments in this course meet the Business Major objectives, please click here

Course Requirements and Grades

Click here to view the University's Policy on Academic Integrity

Click here to view the Business Department’s Code of Student Conduct

	Midterm Exam on Wednesday, October 7^th at 1pm (15%) The midterm exam is scheduled for Wednesday, October 28^th in class. Absolutely no exams at alternative times will be given. You have the exam schedule at the start of the semester. You are responsible to be at the exam. If you have a valid excuse to not be in class the day of the midterm exam, then you will receive a score on the exam equal to the score of your final exam. There are only three valid excuses to miss an exam: 1) You are in the hospital; 2) A family member passed away recently; or 3) You must participate in a recognized NCAA sporting event. If you miss an exam for an invalid reason (not one of the three reasons described above), you will receive a zero on the exam.
	Final Exam on Wednesday, December 16^th at Noon (15%) The cumulative final exam is scheduled for Wednesday, December 16^th at Noon in 321 AC. You are responsible to be at the exam.

	Great Debates Team Presentation (10%) During the “The Great Debates Week” (November 2, 4, 6) we will hold three debates on the subject of the Economics of Collegiate Athletics: · Should college athletes be paid? · Should the Mount have a football team? · Does Title IX positively affect college sports? You will be placed on a team that will either argue “yes” or “no” to one of the questions above. Your team will responsible for writing a brief paper on the subject and participating in a debate in class against a team with the opposing view. Quarterback Madness Exercise (10%) In this classroom exercise, students will use NFL Quarterbacks to learn important concepts in auction theory, risk management, and portfolio theory. Students represent different athletic apparel companies vying for the sponsorship rights to individual NFL Quarterbacks. The NFL will place each quarterback’s sponsorship rights on the auction block. The value of these rights will be determined by how well the quarterbacks play over a specified time period. Risk management is examined by allowing students to diversify their portfolios by buying and selling full or partial shares of the sponsorship rights. The exercise simulates the many phenomena associated with auctions of commodities with unknown values.
	Class Participation and Attendance (10%) Perfect attendance and enthusiastic participation are expected! You must come prepared for class by completing assigned reading and homework problems. If you have to miss class for a valid reason - you are in the hospital, a family member passed away, or you must participate in an NCAA sporting event - then please let me know. You will not be penalized. If you choose to miss class for any other reason, I do not need to know why. You are an adult, and I realize that you may have other priorities and commitments outside of our class. However, as an adult, you realize that if you are not in class, your class participation and attendance score will be adjusted accordingly. You will also find that if you miss class, you will have trouble with the exams and the course projects. When you miss class, it is your responsibility to keep up with the reading and to get class notes from another student.
	Franchise Management from EconFantasy.com Simulation (20%) Each student (either individually or with a partner) will manage a franchise within a twelve-team fantasy football league during the fall 2009 semester. Students will be responsible for establishing a league revenue-sharing structure, developing a business plan, hiring players, setting starting lineups for games during a ten-week season, setting prices for tickets and concessions for home games, and ensuring both league and franchise profitability. The simulation offers students the opportunity: · to manage a sports franchise both on-the-court and in the front office; · to understand the tension between the need to cooperate with other league owners and the desire to compete for wins and profits; · to experience the effects of revenue-sharing on franchise and league performance; · to construct a sophisticated economic model to determine optimal pricing for tickets and concessions at a sporting event; · to deal with the asymmetry among economic agents that have different starting endowments; · to develop a revenue forecast and construct a business plan for a sports franchise; · and to primarily have fun while learning sports economics! Term Paper and Presentation (20%)

You will be expected to write an empirical term paper. You will make a presentation of the paper to your classmates during the last two weeks of class. You will present your findings, and then you will generate a class discussion on your topic. The paper should address a major issue in the economics of sports, and you must use the Journal of Sports Economics for at least one of your references. You may also use a trade publication like the SportsBusiness Journal and other economics journals as additional references. Your paper should extend the empirical analysis in the Journal of Sports Economics paper.

Empirical Project Components
Project Phase	Date Due	Points
Topic approval	9/28	20
JSE Article Review and Bibliography	10/5	30
Data source approved	10/19	30
Descriptive Stats/graphs	10/26	40
Empirical Report - draft 1	11/9	60
Empirical Report - draft 2	11/30-12/11	120
		300