Financial performance and sport performance: some insights from Italian football clubs

Recent years have shown great instability in the football industry that
could be related to the need of investing large amount of money to be
competitive. Since literature is characterized by mixed results that do
not define a clear landscape, this paper aims to explore if a
relationship between sporting performance and financial performance
in professional football clubs exists, with a specific focus both on the
Italian premier league but also in the minores ones. We tested our
hypothesis using a panel regression on a dataset that includes
financial and sporting data for 70 Italian professional football clubs
which have competed in the three main national championships over
a ten-year period (2010-2019). Results show a negative relationship
between financial and sports performance and that football clubs with
good financial performance reach lower sports outcomes. Hence our
findings highlight that, both for the major Italian League and for the
minority ones, clubs fail to pursue both high sports achievement and
good financial outcomes. These results may suggest and encourage
better managerial practices aimed to reduce failure. Better practices
are need not only for the football teams in top championships but also
in for the less prestigious ones. These results should also stimulate
policy makers to provide regulations that can foster a better balance
of the sport and financial dimensions of both top and minor leagues.