Comparison of television and gate demand in the National Basketball Association

This study analyzes the differences between the determinants of economic demand for television audiences and gate attendance. Due to data availability problems, there are few studies focused on television demand for North American sports leagues, and most of those studies do not compare the differences between television and live game audiences. The primary determinants of demand that are compared are income, team quality, and both direct and indirect substitutes. Using data from the National Basketball Association (NBA), we find that fans who attend games live are inherently different from fans who watch games on television. Although insignificant to gate attendance, income is an inferior good to television audiences. Fans who watch the games on television are 4.5 times more sensitive to winning. The demand for television audiences is decreased more by direct substitutes compared to gate demand. However, demand for gate attendance is decreased more by indirect substitutes compared to television demand. (C) 2011 Sport Management Association of Australia and New Zealand. Published by Elsevier Ltd. All rights reserved.