An introduction to the challenges of distributive equity in the English Premier League

Abstract

Purpose

This article provides a plain language commentary on the distributive equity structure of the English Premier League (EPL) with the aim of introducing sport business practitioners to a foundational challenge facing professional leagues as they grow financially with market opportunities, namely financial inequality between clubs.

Design/methodology/approach

Introducing and discussing data from seasons 2009/10–2018/19, the article reveals that despite maintaining a consistent distribution of the EPL prize fund over time, the financial imbalance within the league has grown throughout the period.

Findings

The EPL's financial distributive equity is exacerbated by growing imparity in the acquisition of sponsorship revenues, the distribution of broadcasting revenues and the implications of policies concerning financial fair play and parachute payments, leading to a problematic differential in the talent distribution and win–wage relationship experienced by the top six teams and the remainder.

Practical implications

The EPL's market-driven continuation of its revenue allocation policies has led to a broadening financial imbalance, in favour of the top clubs, which could paradoxically undermine the financial security of the teams and league. Sport business practitioners should be familiar with this fundamental challenge for sport leagues that accompanies financial growth.

Originality/value

Whilst the percentage difference in prize fund allocation between top and bottom clubs appears minor, there is a significant financial variation across the league, primarily due to the large increase in broadcasting income. This is compounded by positive feedback via the relative dominance of the top six clubs receiving the larger share allocated to higher finishing teams.

Citation

Bishop, R., Smith, A.C.T. and Read, D. (2022), "An introduction to the challenges of distributive equity in the English Premier League", Sport, Business and Management, Vol. 12 No. 3, pp. 284-304. https://doi.org/10.1108/SBM-04-2021-0053