The point isn't getting more than what you paid for. The point is that you need to extract the surplus labor value out of the player because you (Levy) are dependent on his surplus labor for your own cut. That's precisely the innovation that capitalism brought to the table.
I think we're mostly in agreement, but you read my post as descriptive instead of suggestive. I didn't mean to suggest that I think clubs do behave in this way. But I think it would be a good way for them to do so.
Here the baseball model is particularly instructive. For those who don't know, teams withhold player's arbitration clocks as long as possible so they can get as much of the peak or near-peak output of the player while he is still under arbitration (making near the league minimum). By the time he's a free agent, he will undoutably earn far more than he will ever actually produce (in terms of win shares) on the field.
Of course, in baseball all a team pays for is the player's wages; there are no transfer fees. But I think football fans, in general, tend to overvalue transfer fees in relation to wages. A player past his peak will likely overvalue his value in terms of wages (because he has earned more in the past, because he doesn't see himself as past his prime, or whatever), whereas a player before his prime overproduces his wages (see Bale or even Kane). Kane has just (or will soon?) double his wages, but that's still probably less than the value he'll bring to Spurs, esp. compared to a big-earner like Adebayor.
As for Veblen goods, I think that's pennywise but perhaps poundfoolish. I'm not sure (but I believe) that this model is sustainable for very much longer. And even so, there are very few clubs that probably do view players in such a way. In the England, I'd count only Chelsea and City as clubs that pay over the top just to show off that they paid over the top. Though perhaps Man U, with their "we always get our man" mentality. Levy doesn't behave that way, though, nor do the clubs that finished behind us. Sure, a club might splash cash upon promotion, say, or show "they're serious this year" with a big purchase, but the idea is always that the money spent will generate value on the pitch.
And fans, certainly, don't view signings as Veblen goods.
One reason that I think the model is unsustainable is because I wonder if buying "the finished good" is actually as risk-free in comparison to academies (which not just provide new squad players but also generate revenue based on selling players who will never cut it in the first team). Liverpool bought a lot of players last season with good PL seasons a mere matter of weeks behind them, and what came of that? Sure, there were warning signs (Lambert might be the poster child for the kind of post-peak buying I'm talking about here), but Liverpool just chose to ignore them, thinking that "he's done it in the rain in Stoke before, surely he can do it again" is all it would take.
Anyway, friends?
ochbye:
