The unfairness of the revenue distribution system used in the UEFA club competitions

ABSTRACT

The Union of European Football Associations (UEFA) distributes commercial revenue from its club competitions according to a complex mechanism. Coefficient-based amounts are paid such that the participating teams are ranked on the basis of performances over the last 10 years. Due to the non-anonymity of this allocation rule, all clubs are interested in qualification together with lower-ranked teams, which makes the procedure incentive incompatible. In particular, the English club Arsenal is found to lose 132 thousand Euros prize money in the 2022/23 UEFA Europa League because of exerting full effort in its domestic championship. Two strategy-proof alternatives are proposed to divide fairly this pillar of the revenue distribution system.

KEYWORDS:

• Allocation rules
• football
• incentive compatibility
• mechanism design
• UEFA

Acknowledgments

We are grateful to Aleksei Y. Kondratev for useful advice.

Two anonymous reviewers provided valuable comments on an earlier draft.

Disclosure statement

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

Notes

1. Source: Szymanski (2003, p. 1137–1138).

2. The regulation (UEFA 2022b) says that the cup winner receives 60% and the other team 40% but the split is equal (50%-50%) if the domestic cup winner does not qualify for the Europa League group stage. Therefore, it is not clarified whether Arsenal is counted as the cup winner instead of Liverpool or not.