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Abstract This research paper examines how antitrust laws have played a role in shaping the financial operations of the professional sports industry of today.
Different aspects of economical, historical, governmental, cultural and financial perspectives have been identified as vital sources in the professional sports industry of the past, present and future. This paper will also provide case studies and other field research to reveal how the influence of economical, historical, governmental, cultural and financial perspectives stem from antitrust laws that have shaped the world of professional sports today in the NFL for football, NBA Sherman antitrust act research paper basketball, NHL for hockey, and MLB for baseball.
Introduction The professional sports industry has evolved into an intriguing social phenomenon. As time has progressed, there has been an increase in women and minorities in both the player and managerial ranks.
As a result, the professional sports industry finds refuge under public policies. As an entity of private ownership in this capitalistic American society, the professional sports industry has become a thriving market.
Purpose of the Paper The purpose of this research paper is to examine how antitrust laws have played a role in shaping the financial operations of the professional sports industry of today. These issues manifest both simple and complex questions. A set of questions emerges from economical, historical, governmental, cultural and financial perspectives that are listed as follows: What actions and reactions have most often occurred in the PSI and our society in response to governmental regulations?
What is the projected role of government in the PSI? Does the PSI operate under the same governmental regulations, as do other private industries? Which branch of government has been most effective in regulating the PSI?
Are there applicable statutes or judicial proceedings affecting the PSI? Has the principle of judicial review been able to effectively control the PSI?
Do antitrust laws have a negative or positive impact on the financial aspects of the professional sports industry? What is the economical impact of the professional sports industry?
With these questions in mind, it is essential that definitions of various terms be included to provide more background information in this area of research. Definition of Terms Firstly, what is antitrust law?
Simply stated, according to Corley and Reedantitrust law is used to describe all laws that intend to promote and regulate competition and make our competitive economic system work. Secondly, what is the economic giant known as the professional sports industry?
According to the Adams and Brockprofessional sports are a textbook example of a bilateral cartel made up of club owners and unionized players engaged in intrastate and interstate commerce.
The club owners exercise monopoly power in the product market and monopsony power in the input market, whereas, the players try to countervail that monopsony power. For example, according to Wikipedia, i n economics, a monopsony is a market with only one buyer in the market, often an input market Wikipedia, At the same time, this is analogous to the case of a monopoly in which there is only one seller in a market.
Significance of the Study Answers to these questions and terms should provide relevant and significant information pertaining to the professional sports industry as a whole.
By identifying governmental perspectives of the PSI, the importance of the antitrust law will be revealed through a financial perspective. This paper also contains case studies of actions and reactions in the PSI that will further support the significant role of the antitrust law in regards to the PSI from a financial perspective.
This paper further pinpoints how the professional sport of baseball best exemplifies the implementation, application, and interpretation of the antitrust exemption issues. Review of Literature The professional sports industry is a very unique entity.
As an entity, it controls both activities and attitudes, solicits actions and reactions, and demands the immediate attention of fans, arbitrators, mediators, lawyers, judges, players, television networks, and management. However, as an entity, it is regulated as a business activity with and without exemptions from the federal government.
To limit the framework of both the professional sports industry and antitrust activities, the underlying meanings of past, present and future perspectives will be discussed.
The Historical Role of Antitrust Laws in the Professional Sports Industry Historically, antitrust law has played a role in developing regulations, controls, and protections in the professional sports industry of today.
Federal Baseball Club of Baltimore, Inc. Also, there is a history of concepts relating to protections and guarantees to all parties involved in the professional sports industry.
Once a team obtained contractual rights to a player, it enjoyed exclusive rights to his services. Also, certain sports in the professional sports industry are classified as with antitrust labor exemption, whenever the players can file complaints with the government alleging unfair labor practices or without antitrust labor exemption, whenever the players cannot file complaints with the government alleging unfair labor practices McGraw, On the other hand, case studies show that in football, basketball, and hockey, the emphasis has been on the relief granted through the application of antitrust laws McCormick, A final aspect focuses on what is the historical, legal, economic, and future role of antitrust laws in the professional sports industry of Major League Baseball MLB?
For example, according to U. Throughout the history of sports, several events have occurred leading to how antitrust laws are now applied along with their financial impact. It provides a running account of actions that have been taken by leagues and set the stage for legal court challenges: It also provides a historical time line leading up the formation of the American Association and present day MLB baseball.An Early Assessment of the Sherman Antitrust Act: Three Case Studies Abstract The majority of the research literature on early antitrust law focuses on prices and output, but few empirical.
Sherman Antitrust In 21st Century Essay, Research Paper. Sherman Anti-trust in the twenty-first Century. Whilst nearing the Twenty-first Century, America has taken important paces in the promotion of high engineering.
The antitrust issue dominated the presidential election and led to the Clayton Act and the Federal Trade Commission Act of The operative provisions of Sherman Antitrust Act of are. Sherman Antitrust Act The Sherman Act of finished the era of truly free market in the United States of America, although, ironically, it has been directed at protecting the freedom of competition.
Sherman Antitrust Act The Sherman Act of finished the era of truly free market in the United States of America, although, ironically, it has been directed at protecting the freedom of competition. This legislation was followed by the Sherman Antitrust Act of , the first law to limit monopolies, the Clayton Antitrust Act and the Federal Trade Commission Act (both ), which regulated price discrimination and mergers, as well as the Robinson-Patman Act .