Insolvency in French soccer: The case of payment failure

Citation

Scelles N, Szymanski S & Dermit-Richard N (2018) Insolvency in French soccer: The case of payment failure. Journal of Sports Economics, 19 (5), pp. 603-624. https://doi.org/10.1177/1527002516674510

Abstract
This paper examines insolvency (payment failure) in the top three divisions of French soccer. Between 1970 and 2014 we observed 79 cases of insolvency arising from participation in the top two or three (since 1993) divisions. We find that demand (attendance) shocks can account for insolvency to a significant degree. We also find that insolvency can be explained by club status and ownership structure, with professional status and the Association structure being more likely to lead to insolvency. We also examine the post-insolvency performance of soccer clubs and find that the adverse consequences of insolvency are long lasting.

Keywords
insolvency; payment failure; French soccer; attendance; demand shocks; club status; ownership

Journal
Journal of Sports Economics: Volume 19, Issue 5

• Accepted manuscript