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We're 26 republicans who vote like socialists (on the issue of revenue sharing).
Late Baltimore Ravens owner art Modell
1. Introduction
Revenue sharing is ubiquitous among North American professional sports leagues. In a standard pool revenue sharing arrangement, teams earning a level of revenue that is above the league average transfer revenues to those earning below the league average revenue. This transfer can take place either directly, via financial transfers, or implicitly, via the prepooling and disbursement of league broadcasting revenues. We find and prove that a league will vote into policy a pool revenue sharing arrangement if and only if mean team revenue is greater than presharing median revenue, where this condition is equivalent to the presence of a positive nonparametric skewness in a league's distribution of team revenues. This represents a median voter theorem for league revenue sharing.
We further consider the case of the National Football League (NFL), a league that pools and equally shares national revenues among member teams. Effectively, then, the NFL has shared approximately 61% of all revenues since the 2004 season (Bloom, 2014). Herein, we examine – from a median voter theorem perspective – why pool revenue sharing has been (historically) chosen – via a series of unanimous or near-unanimous votes – by a majority of NFL owners. Taking advantage of financial disclosure requirements for the Green Bay Packers, as well as NFL team revenue data from Forbes.com, we disaggregate NFL team-season revenue values into local (unshared) revenue and national (pooled and equally shared) revenue. We do so for all (32) 2016 NFL team-seasons. We then measure the nonparametric skewness of unpooled team revenues for that season. Unlike the parametric skewness test, the nonparametric skewness test is positive (negative) if and only if mean is greater than (less than) median. Thus, the sign of the nonparametric skewness test statistic directly informs whether the theoretical condition for revenue sharing is met. Herein, the nonparametric skewness test concludes significant, positive skewness for 2016 NFL team revenue data. By a significant margin, mean, unpooled team revenue is greater than median unpooled team revenue for the same season. In other words, the median (unpooled revenue team) benefits from a mean-reverting pooled revenue sharing scheme such that the median revenue...