Top Clubs’ Performance and the Competitive Situation in European Domestic Football Competitions

Abstract

The increase in payouts to European football clubs appearing in the Union of European Football Associations (UEFA) Champions League (CL) in 1999-2000 had a lasting impact on the performance of top clubs in domestic football leagues. This policy change is treated as a natural experiment to compare the level of competitive balance in five top European leagues (England, Spain, Italy, Germany, and France) before and after the turn of the millennium. Based on several competitive balance measures, this article reveals a significant decrease in competitive balance after the modification of the CL payout system.