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The impact of the Financial Fair Play regulations on financial distress of Dutch professional football clubs

Havekes, Koen (2021) The impact of the Financial Fair Play regulations on financial distress of Dutch professional football clubs.

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Abstract:European professional football clubs invest large amounts of money in football players. Previous studies found evidence that this led to financial distressed situations. To improve the financial position of European football clubs, the UEFA implemented Financial Fair Play regulations in 2011. This study investigated for 11 Dutch professional football clubs the impact of: (1) player expenditures on financial distress, (2) Financial Fair Play on financial distress, (3) Financial Fair Play on the relation between player expenditures and financial distress. OLS regressions are performed for a sample of 110 club-year observations between 2008 and 2018. The results found evidence that player expenditures positively impact financial distress. Furthermore, there is strong evidence for a negative impact of Financial Fair Play on financial distress, which means that Financial Fair Play regulations improved the financial position of Dutch football clubs. Lastly, no unambiguous evidence is found for an impact of Financial Fair Play in the relation between player expenditures and financial distress. This study contributes to the scarce literature about Financial Fair Play by analyzing a unique Dutch sample.
Item Type:Essay (Master)
Faculty:BMS: Behavioural, Management and Social Sciences
Subject:85 business administration, organizational science
Programme:Business Administration MSc (60644)
Link to this item:http://purl.utwente.nl/essays/86009
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