Financial Fair Play and its Intended Impact - An Investigation of the European Football Environment

Abstract

This study examines what effect the implementation of UEFAs Financial Fair Play regulations have had on football clubs' financial performance and if the top leagues competitiveness in Europe has changed for the better. The two main standpoints for this paper are both in question by the general public. This study seeks to help get somewhere along the way with answering some questions regarding the FFP. The study has been conducted with four GLS regressions to observe the chosen variables before and after FFP was implemented, for both of the two dependent variables, net income and concentration ratio. The data has given somewhat contradictory results, but despite this, conclusions about the research questions can still be drawn. Although there are factors that speak for better finances, the regression analysis regarding the clubs net income can not confirm that the financial health has improved in the footballing world. Regarding the fairness aspect, the results have marginally improved and are positive about how the top leagues are developing. Some signs say the opposite, but the overall results suggest that the leagues have become more competitive than before the implementation of FFP.