Determinants of attendance in the early days of US professional baseball: panel estimation, 1892–1940

ABSTRACT

If fan demand is driven by balanced competition and/or the spectacle of the game, then all teams can do well. However, if winning is what really counts, life becomes very difficult for the teams at the bottom of the standings each year. In contrast to the dominant role played by television and media rights today, the calculation was more clear-cut during US baseball’s early days when simply getting fans in the stands was what paid the bills. Although our panel data analysis shows that other factors like home runs hit and competitive balance were also significant over the 1892–1940 period, it appears that fans then, like today, mostly just wanted to see their favourite team win.

KEYWORDS:

• Baseball attendance
• prewar period
• winning percentage
• competitive balance

JEL CLASSIFICATION:

• Z21
• N11
• N12

Disclosure statement

No potential conflict of interest was reported by the author(s).

Notes

¹ There was an accompanying incentive to keep player wages as low as possible, of course, and a ‘reserve clause’ effectively prevented players from signing with any team other than their own.

² This Washington Senators team was subsequently wound up in 1899 (Thorn et al., 2004, 903). Confusingly, a second incarnation of the Washington Senators was established in 1901 (before becoming the Minnesota Twins) and a third incarnation then added in 1960 to replace the team that had moved to Minnesota (later themselves moving after the 1971 season to become the Texas Rangers).

³ Seymour and Mills (1971, 51) reference a general admission charge for the grandstand still standing at 75 cents when Pittsburgh’s Forbes Field opened in 1909 and, according to Seymour and Mills (1971, 68), average admission prices stayed around 66 cents up through 1916. Haupert (2007), in turn, lists average ticket prices standing at a single dollar in 1920.

⁴ Data displayed in (BallparksofBaseball.com.) should be acknowledged that 1917–1918 attendance levels were impacted by the US entry into the First World War in April 1917, leading to the loss of players who left the league to join the war effort as well as the rounding up of ticket prices to account for the new 10% tax on amusements that was imposed in 1917 (von Allmen, 2022). Similar wartime restrictions applied in both 1917 and 1918, however, and the Spanish Flu remains the most plausible explanation for the 1918 drop being so much bigger than the 1917 drop.

⁵ In addition to the widespread team movements and new team formation in the subsequent ‘expansion era’, other factors coming into play include the increasingly important role played by new stadiums (Depken, 2000, 2006). This contrasts with the apparent relative simplicity earlier on as emphasized by both Ahn and Lee (2014) and Lee (2018).

⁶ As quoted in Bauer (2020, 119). Subsequently, studies using data from the latter 20th century and 21st century indicate wins becoming increasingly less important to an MLB team’s revenue. As Berri et al. (2015) note, this is because fixed revenues (primarily broadcasting revenue) are an increasingly important part of a team’s revenue. Fixed revenues are not related to how much a team wins (see also Berri and Krautmann, 2019).

⁷ The colour-barrier that was imposed on US professional baseball in the 1880s restricted teams to fielding only white males prior to baseball’s reintegration in 1947. Schmidt and Berri (2003) provide evidence that this artificially limited supply of elite talent led to much lower levels of competitive balance. Further support for expanded talent pools boosting competitive balance follows from allowing foreign player entry into domestic European football leagues (Flores et al., 2010) and gains associated with expanded gender equality in international women’s competitions (François et al. 2022) (Scelles, 2021).

⁸ Another factor muddying the water is the substantial heterogeneity in fan preferences regarding visiting, as well as home, team quality that Mills and Fort (2023) identify across different MLB markets.

⁹ Other studies have also looked at the impact star power has on demand (see, for example, Hausman and Leonard, 1997, Jane, 2016, Humphreys and Johnson, 2020, Kaplan, 2022).

¹⁰ The macroeconomic variables are not highly correlated as shown in Table 2.

¹¹ In addition to the question of unbalanced schedules, application of McGee (2016) would also require game-by-game records that were unavailable to us for the prewar period.

¹² Each of the per game variables is the annual average for each team.

¹³ We also considered a ‘Name Change’ variable set equal to one if a franchise changes its team name in the year in question. These name changes are set out in APPENDIX Table A2, which shows the largest number of name changes to be is six – for the franchise that endures today as the Los Angeles Dodgers. Allowing for this variable had no meaningful impact on the findings, however, and results have been excluded to save space.

¹⁴ Each of the macro variables is stationary over time and there are no high correlations among them (Table 2).

¹⁵ Attendance per game is the team’s average attendance per game in a year. Logging the dependent variables is not only warranted by its large range (Table 1) but also ensures its stationarity.

¹⁶ Significant output and inflation effects over the prewar period also emerge in the aggregated long-run cointegration analysis conducted by Tao, Burdekin and Berri (2022).