Monday, February 15, 2016

La Liga – A Case for a Salary Cap?


Since the year 1984-1885 season, there has only been five seasons where the dominant Futbol Club Barcelona and Real Madrid have not won the La Liga Primera Division Championship. Currently, FC Barcelona is in first place of La Liga (having not lost a single game at home this season) and Real Madrid is in third place (surprisingly). It is been clear throughout the history of La Liga that these two clubs are not just two of the most dominant teams in Spain, but also in the world. While this is great for these clubs, it has not been so beneficial for the other clubs throughout Spain and La Liga. It is well known that apart from Athletico Madrid, the other clubs in the country have struggled to compete. When you compare La Liga to the Premier League, there is a huge cap in the average quality of teams in the league. The top dogs of La Liga continue to get best players year after year and continue to win championships. The quality of the league overall is very low because of this, and I believe that the implementation of a salary cap will help the process of creating greater competition in La Liga. If a salary cap were to be imposed on the league, smaller market teams would become more level with the original power house clubs. They would be able to sign similar talent and the games would be more enjoyable to watch (compared to watching Barcelona blow out Celta Vigo 6-1 last night). The image below displays the salary distribution from 2013. There is a clear dropoff after the Barcelona and Real. Almeria does not even have 4% of the total salary of FC Barcelona. How are they expected to compete? In the upcoming weeks I will attempt introduce a formalized salary cap plan that would enable more competition in La Liga, while keeping the best teams competitive on an international scale.


6 comments:

  1. You cannot make a salary cap in one league unless you make it in all the leagues, across the world. They would no longer be competitive in Europe.

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  2. Agreeing with Tyler, it would be harmful to La Liga as a whole if they were the first to implement a salary cap. The teams representing La Liga in the Champions and Euro League would then be at a disadvantage to the rest of the competition in Europe. Unfortunately, all leagues around Europe all have similar points of view on this and nobody would dare be the first to make the move to a salary capped league. In order to level out the playing field, UEFA would have to create a salary cap standard and due to the vast differences of current spending levels of teams all over Europe, this standard would likely be next to impossible to determine fairly. Also contributing to the idea that it wouldn't be likely for UEFA to ever salary cap European soccer is the fact that they would then lose more and more players to the MLS and other leagues around the world. That would certainly not be good for anyone in involved in European soccer.

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  3. Investopedia describes a monopoly as "a situation in which a single company or group owns all or nearly all of the market for a given type of product or service. By definition, monopoly is characterized by an absence of competition, which often results in high prices and inferior products."

    Football in Spain looks quite monopolistic when put against this definition. Afterall, football clubs are just individual entertainment companies. I agree that putting a salary cap in just Spain could cripple the countries ability to compete in Champions and Euro League. That just means that this needs to be brought up by Spain to UEFA as a league wide issue. Look around to any country and you will see similar situations (some more severe than others). I don't have the answer to what the cap should be, but if you are pro-business and pro-competition, there is no arguing things need to change.

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  4. I agree with what tyler said completely. If La Liga implemented a salary cap, they would no longer be a competitive league in European football. Barcelona and Real Madrid's star players would leave their clubs and pursue leagues without salary caps so they could make the money thy are used to making. La Liga is in the situation where they have two powerhouse teams and adding a salary cap to the equation would simply worsen the league. The challenge is to create a more even playing field similar to that of the English Premier League, but a salary cap for the league is not the answer.

    -Colin Zaccagnio

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  5. Yeah all in the same with the other comments..it would be harmful for La Liga to implement a salary cap system as many of the star players would flock to leagues without salary caps and get as much money as they can. A way to remedy this is to have owners of these teams who are able to provide financially. Who would want to buy these teams and would they be willing to change their ownership system? Who knows. But to be successful and be more competitive, there has to be a way to get more money into these lower standing teams as they could invest in better foreign players or get a better youth program.

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  6. As mentioned above, I think implementing a salary cap system in La Liga would be detrimental to the league. The top players would sign in other European leagues without salary caps in order to make as much money as possible. If every league in Europe were to create the same salary system, I could see competition in La Liga increase, but I doubt that would every happen.

    I do agree that there needs to be some sort of change, however. If this current setup continues, and the only challenge that Barcelona and Real Madrid face in the league every season is two games against each other, the level of competition will suffer. Although this will never happen, I think FCB and RM need to stop being so selfish and protect their own domestic league. With the way that the television revenue is split in Spain, the two clubs get nearly half of all the money between them, with the other eighteen clubs left to pick up the scraps. Redistributing the television rights could eventually be a way of increasing the level of competitiveness in La Liga.

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