| INSTRUCTOR DISCUSSION NOTES:
Not Every Team May Win, But The National Football League Sure Knows How To Operate A Cartel Successfully |
1. Should the NFL be considered a cartel under antitrust legislation? Why or why not?
Answers vary, depending on how the profit-sharing is viewed. Typically, cartels restrict competition. The profit-sharing adds to decreased competition.
2. Does such an agreement create an incentive for a team to free-ride on the other teams?
Yes. Cincinnati, for example, was the fifth-most profitable team in the 1990s, but had the fewest wins. It simply chose to skimp on talent scouts and other costs to increase its profitability.
3. The NFL has seen 17 new stadiums built since 1987 around the country. What impacts does this have outside the stadiums?
Costs include increased taxes, infrastructure and transportation. Benefits include additional retail outlets, services, etc.
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