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Reference-dependent preferences in the case of Allsvenskan: Outcome uncertainty and live-game attendance

Hallén, Gustav LU and Johansson, Gustav LU (2018) NEKH02 20172
Department of Economics
Abstract
This thesis studies how different preferences for uncertainty affects live game attendance in the Swedish premier football league Allsvenskan. A framework proposed by previous literature concerning this relationship is highlighted. In the presence of reference dependency, two types of preferences is of interest. On one hand, there is the Uncertainty of Outcome Hypothesis (UOH), stating that uncertainty drives attendance. On the other, there are loss averse preferences, predicting higher attendance on games where the outcome is certain. To examine what preferences holds for Allsvenskan, a panel data regression is used to investigate the relationship between the level of uncertainty and attendance. The probability of a home team win, derived... (More)
This thesis studies how different preferences for uncertainty affects live game attendance in the Swedish premier football league Allsvenskan. A framework proposed by previous literature concerning this relationship is highlighted. In the presence of reference dependency, two types of preferences is of interest. On one hand, there is the Uncertainty of Outcome Hypothesis (UOH), stating that uncertainty drives attendance. On the other, there are loss averse preferences, predicting higher attendance on games where the outcome is certain. To examine what preferences holds for Allsvenskan, a panel data regression is used to investigate the relationship between the level of uncertainty and attendance. The probability of a home team win, derived from the odds, is used as a proxy for the uncertainty present in the game. Our panel includes data on twelve teams that have participated in Allsvenskan during the seasons 2014-2016. The dataset is created by combining game-by-game statistics from the official webpage of Allsvenskan, with odds data compiled from 20+ bookmakers. Additionally, other sources are used to obtain data on control variables which rounds out the set. Ultimately we find the UOH to be present in the aggregate spectator of Allsvenskan. Also, Attendance is found to peak at a point where the probability to win is 61,5%. (Less)
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author
Hallén, Gustav LU and Johansson, Gustav LU
supervisor
organization
course
NEKH02 20172
year
type
M2 - Bachelor Degree
subject
keywords
Reference-dependent preferences, Uncertainty of Outcome Hypothesis, Loss Aversion, Football, Allsvenskan.
language
English
id
8935172
date added to LUP
2018-02-14 18:32:28
date last changed
2018-02-14 18:32:28
@misc{8935172,
  abstract     = {{This thesis studies how different preferences for uncertainty affects live game attendance in the Swedish premier football league Allsvenskan. A framework proposed by previous literature concerning this relationship is highlighted. In the presence of reference dependency, two types of preferences is of interest. On one hand, there is the Uncertainty of Outcome Hypothesis (UOH), stating that uncertainty drives attendance. On the other, there are loss averse preferences, predicting higher attendance on games where the outcome is certain. To examine what preferences holds for Allsvenskan, a panel data regression is used to investigate the relationship between the level of uncertainty and attendance. The probability of a home team win, derived from the odds, is used as a proxy for the uncertainty present in the game. Our panel includes data on twelve teams that have participated in Allsvenskan during the seasons 2014-2016. The dataset is created by combining game-by-game statistics from the official webpage of Allsvenskan, with odds data compiled from 20+ bookmakers. Additionally, other sources are used to obtain data on control variables which rounds out the set. Ultimately we find the UOH to be present in the aggregate spectator of Allsvenskan. Also, Attendance is found to peak at a point where the probability to win is 61,5%.}},
  author       = {{Hallén, Gustav and Johansson, Gustav}},
  language     = {{eng}},
  note         = {{Student Paper}},
  title        = {{Reference-dependent preferences in the case of Allsvenskan: Outcome uncertainty and live-game attendance}},
  year         = {{2018}},
}