NCAA Scholarship Limits andCompetitive Balance in College Football

This article examines the effects of scholarship limits on competitive balance in college football. Hypothesizing that there has not been an increase in parity, the authors present a model of competitive balance. Using two regression models, they attempt to evaluate the measures of parity within college football since World War II (1946-2000) and rule changes. Their first model uses margin of difference in scores, actual standard deviation of wining percentages of all schools divided by the theoretical standard deviation, Associated Press rankings including poll entrants, poll reentrants, total number of different teams in the rankings over a given number of years, a Herfindahl-Hirschman Index of concentration of poll appearances, and conference champions.The study found mixed results when analyzing the regression models. It appears that within-year competitive balance has decreased while competitive balance seems to increase when measured with the Associated Press Top 20 poll. It appears that instead of increasing competitive balance, scholarship limits achieve only a limitation on resources spent on football. The second model evaluates voting trends of the 1991 NCAA roll-call vote to reduce scholarships. Using variable such as age of the university, whether or not the school is a state-supported university, tuition, enrollment, and whether or not the school voted for or against a lower scholarship limit. They determined that age and enrollment were not significant while membership in a major conference, public universities, and tuition were all significant. The regression showed more successful teams are more likely to vote for limits.

Data:

Model 1:

Variable Name / Description
MARGIN / The difference between the average score of the winning teams in a year and the average score of losing teams
RATIO / The actual standard deviation of winning percentages of all Division I-A school in a year/ the theoretical standard deviation
ENTRANT / Teams appearing in the Associated Press rankings after not appearing in any of the 5 previous years
HHI / Herfindahl-Hirschman Index (HHI) of concentration of poll appearances

Model 2

Variable Name / Description
VOTE / Dummy variable that equals one for schools voting to reduce the limit of scholarships, 0 if voting no
AGE / Age in years of the university in 1992
AP and AP10 / Measure performance in the final Associated Press poll
PUBLIC / Dummy variable that equals one for state supported universities, 0 for all others
TUITION / In-state tuition in thousands of dollars
ENROLL / School's total enrollment for the 1991-1992 academic year in thousands
MAJCONF / Dummy variable the equals one if a school was a member of a major conference in 1992, 0 if not
CYES and CNO / Dummy variables that equal one for members of conferences that voted for and against the lower scholarship limit
PROBATE / Dummy variable that equals 1 for schools on NCAA probation for football between 1953 and 1991

Sources of data is unclear

(Sutter, Daniel and Stephen Winkler. “NCAA Scholarship Limits andCompetitive Balance in College Football.” Journal of Sports Economics 4, No. 1 (2003): 3-18.