TCS Daily

America: Exceptional No Longer

By Raymond Sauer - June 22, 2006 12:00 AM

The World Cup is in full swing, and the cities of Germany have turned into multi-national festivals celebrating the most popular sport on the globe. But has America joined the party?

The answer to that question is a qualified yes. Although the country is not swept up in a widespread mania, there are obvious signs that interest in the game continues to build in the States. The US Soccer Federation's allocation of World Cup tickets was oversubscribed by a factor of four; each and every game is being televised live for the first time ever, on the nation's major sports network; and the media rights sold for double the price obtained in the prior negotiation. These are signs of a sustained, incremental advance in the popularity of soccer, and economic reasoning suggests this is likely to continue.

The much-discussed "American exceptionalism" with regard to soccer refers to the unique forms of sport adopted in the U.S., and the failure of soccer to capture the public imagination as it has elsewhere. Most analyses emphasize social and psychological factors that might cause the American fan to be uniquely disinterested in soccer. American tastes for home-grown institutions, sports with lots of scoring, and sports with lots of statistics to ponder are part of the explanation, or so the story goes. But the U.S. is not unique in this regard -- it is just large. In the English-speaking world, countries like Australia and Ireland are similar to the U.S., in that their most popular sports are not widely played in other countries, and appear idiosyncratic to foreigners. So in considering the question of "exceptionalism" and the prospects for America to embrace the world's most popular game, it seems useful to examine economic factors which are general to all countries.

Network effects are one important factor. Sport developed in a world where countries had minimal connections to each other, and took shape in different ways. Baseball, cricket, and hurling all combine stick and ball in forms that players and fans in their respective countries find appealing. Network effects limit the variations in form within a society, since if I play baseball and you play cricket, we can't have a meaningful contest. But when teams don't travel across the seas to compete, network effects cease to be relevant. Hence in isolation, different societies may adopt different forms of sporting competition, just as they develop different styles of dress or music.

Network effects also limit the number of sports that are fully embraced by a society. Fans watch games and enjoy sharing their observations with each other. This joint consumption aspect of sport also represents a network effect, since it requires that people watch the same game. This gives sports that are currently popular -- pro baseball, basketball, and football in the U.S. -- a significant advantage in the marketplace, and gives soccer a significant hill to climb. But history suggests that the position of the "big three" sports at the top of the American heap may not be permanent. A century ago, the three most popular American sports were baseball, boxing, and horse racing. Only baseball remains a fixture on the sports pages today. Basketball and professional football barged their way into the post-war landscape of U.S. sport, displacing boxing and horse racing.

Boxing and horse racing fell from their perch, in part, due to economic forces. Boxing is the poster child for poor organization and corruption in sport, a sharp contrast with the efficient, businesslike National Football League. Horse racing suffers from regulatory and political interference in virtually every significant business decision. Horse racing was hobbled while leagues promoting team sports had their eye on the future. These days an American might regard basketball and football as inherently superior forms of sport, but that fails to explain why horse racing remains more popular than either in Ireland. The appreciation of sport is a social construct and hence, again, embedded with network effects. What is clear in hindsight is that American team sports, organized into a league format, were relatively unhindered by regulatory interference. They took advantage of weaknesses inherent in the boxing and racing cultures to supplant them.

Network effects in an increasingly globalized world enhance the prospects for soccer in the U.S., and erode the advantages currently enjoyed by the big three. Prior waves of immigration to this country took place in a world where soccer had not yet become the dominant global game it is today, and where communication was relatively archaic. Now, immigrants to the U.S., whether they be a carpenter from Mexico or a writer from France, are more likely to bring a taste for soccer with them. In earlier decades when the sporting landscape took shape, choices for immigrants were limited to local fare. In today's globalized world, information and telecommunication technologies allow one to follow any of a number of the top soccer leagues around the world.

The same is true for American youth who play the game. In the past, soccer has failed in to generate the critical mass required to sustain the interest of people as they make the transition from child participant to adult consumer. Soccer simply wasn't an available option like it is today. As stated at the outset, the numbers clearly indicate that American interest in viewing soccer is growing steadily. This is taking place despite the fact that MLS, our most prominent soccer league, limits the talent on display for business reasons. That's another story in itself, but it does suggest a potential tipping point in the future. If a U.S. league were to raise its sights and compete for talent and victories on the international stage, American interest in the beautiful game could explode.

The author teaches economics at Clemson University and writes "The Sports Economist" column for TCS Daily. Find more of his writing here.


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