Relative age effect on the market value of elite European football players: a balanced sample approach

ABSTRACT

Research question

Athletes born late in the selection year are disadvantaged compared to the relatively older in youth age groups. This leads to an overrepresentation of the early-born in professional teams, which is called the relative age effect (RAE). Previous studies examine the RAE on wage or market value with contradictory results. This paper aims to estimate the partial RAE on the market value of top-level European football players with a new methodology.

Research methods

We analysed a data set of players from the biggest five European football leagues over ten seasons (2008-2017). We argue that the conventional estimation of RAE fails to yield a partial effect, due to a sample selection bias. For various regression models, we use a stratified sampling method to balance the birth date distribution and eliminate the bias.

Results and Findings

Unlike prior studies, we found an extremely strong straight RAE in elite European football, especially for younger players. Using our methodology, we interpret RAE as a partial effect, which indicates that an earlier birth date within the calendar year results in a higher market value.

Implications

This paper contributes to the literature by proposing a new methodology to measure the partial RAE on labour market outcomes. Our results imply discrimination based on birth date in several countries, which needs to be reduced by better regulation of youth competitions. Our findings have implications for coaches and managers on how to account for relative age when training, transferring, and selecting players.

KEYWORDS:

• Relative age effect
• sample selection bias
• European football
• market value
• soccer

Acknowledgment

This work was supported by the ÚNKP-20-3-II New National Excellence Program of the Ministry for Innovation and Technology from the source of the National Research, Development and Innovation Fund; Thematic Excellence Program 2020 - Institutional Excellence Sub-programme of the Ministry for Innovation and Technology in Hungary under grant number: 2020-4.1.1.-TKP2020; Comprehensive Development for Implementing Smart Specialization Strategies at the University of Pécs under grant number: HRDOP-3.6.1-16-2016-00004. The authors would like to thank organizers and participants of the 4th International Conference on Sport Economics & Sport Management (SESM) in Berlin; Jeffrey Anderson, colleagues at the University of Pécs, and anonymous referees for providing helpful comments.

Disclosure statement

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