Football players’ transfer price determination based on performance in the Big 5 European leagues

Abstract

The existing literature on the determinants of football players’ transfer prices considers bargaining theory and identifies buyer and seller characteristics as main influences. No attention has been brought to performance measures which were directly observable and quantifiable. This study uses a normalised position-specific performance measure to investigate the issue. It finds evidence that player performance does play a role in the determination of transfer prices although the model suffers from incoherencies. The model also investigates a player’s previous contract duration’s effect on the amount of the transfer fee paid. A positive relationship between months remaining on a player’s contract and the fee paid for that player has been found.