The effect of geographical proximity and rivalry on performance: evidence from the English Football League

Abstract

Using data on league position for clubs that have participated in English football leagues for 21 seasons, this paper tests, using spatial econometric techniques, whether clubs’ within-season performances are positively affected by better performances of other clubs located geographically closer to them. The paper provides evidence of positive spatial dependence between clubs’ performance. This means that proximity to high-performing clubs drives others to perform better, ceteris paribus. This is consistent with the view in regional analysis that spatial factors are important considerations in understanding business performance.