National Football League, Journal Of Sports Economics, Victor Matheson discussed on Freakonomics Radio
This is freakonomics radio. Here's your host, Stephen dubner. The National Football League as you may have heard is having some problems huge concern about player safety as we heard from John Herschel and Dominic Foxworth the contentious national anthem protests, which will hear about later and the NFL's audience has shrunk a bit. But let's be honest. The NFL is still a juggernaut of the top fifty shows on TV last year, thirty seven or football games understand. Why understand why sports are such a big deal to so many people? Let's start with a man who pretty much asked himself that question every day. Sure. This is Victor Matheson. I'm a professor of economics at the college of the Holy Cross in Worcester. Massachusetts Matheson specializes in the economics of sport. Yes. I'm one of the editors of the journal of sports economics. I'm also the current president of the North American association of sports economists. And I'm also the author of the economics of sports six addition which. I think the top sports economics textbook in the world. So I kind of having a trifecta going on right now. Now, Victor, are you yourself now or have you ever been an athlete or otherwise seriously involved in sports? Yes. So I was actually a referee for Major League Soccer for about ten years. No kidding. Yeah. My college coach when I was playing I took a look at me and said, hey, you know, I've been watching the way you play the game. And I think you might make an excellent referee. I became a referee because I thought the referees around me when I was a high school player were so terrible. A trained monkey could do better. And here I am thirty years later, and I'm the train monkey and being referee. I got to do things I never would have gone to do as a player. I got to walk out on the tunnel into Soldier Field in RFK stadium. And and you know, I never would have been talented enough to do that. I've had the opportunity to referee a thousand college games one hundred pro games. I wouldn't have done that as a player for sure. Victor, how old are you? If you don't mind me asking. So I am turning forty nine next next week. Okay. Happy birthday. Can you talk for minute. Then about the ways in which sports, especially the business of sports is different from when you were a kid sports, become bigger and bigger and bigger business. So a little before my childhood, but not much more before that we would have athletes in the NBA and NFL have fulltime jobs in the off season. Because your you're not making enough in the season to actually survive without having something to do in the off season. I'm here at Holy Cross. Our most famous athlete is Bob Cousy the first great point guard. He lives in a very modest house here in Wooster because he never made forty million dollars a year like a top NBA player might make now. And so obviously, that's a huge difference. Right. And other than I guess the obvious answer of we like to watch sports and. Consume all things around sports. Why else do you think that sports have such an appeal that makes them so valuable that ultimately generates so many dollars, and I've all well. Number one, we make more money, and we have more free time today than we did in the past. And so we have a lot more disposable income to spend on play and on recreation and on toys than we did a generation or two generations or three generations ago. Number two. We also have technology that helps us enjoy sports in a way we didn't in the past either. So I am not super old but old enough to remember watching sports on the nineteen inch black and white TV that we had and obviously my flat screen fifty inch high def TV that I can watch shocker from any country in the world at any time. I want on demand. Is certainly a much better much better recreation option than trying to pick out exactly which kind of gray player was playing against other player back as a kid. So what can you tell us about the size of the sports industry, and how it compares to other industries? So the answer here is actually surprisingly small. So the biggest league in the world in terms of revenue generated is the NFL and the NFL generates something like fourteen fifteen billion dollars a year. Now, you might be thinking to yourself. Well, fourteen fifteen that sounds like a like a lot of money that's roughly the same size as Sherwin Williams. So the typical American buys as as much paint from Sherman Williams has does buying NFL products from the largest league in the world, you add in all these other American League's NBA major league baseball, the NHL Major League Soccer. Plus, the PGA and pro tennis and mixed martial arts. And all these things atom all up together. You've got maybe fifty billion dollars of pro sports, a few more tens of billions of dollars in college sports. But you're still only up at sixty seventy billion dollars that makes spectator sports in the United States roughly the same size as the cardboard box industry in the United States now, obviously, none of us, you know, gather around the water cooler on Monday morning, saying, hey, man. Do you see that awesome? Cardboard box that American paver just put out. A course we don't so sports has a social impact that is way way bigger than its.