This paper investigates the impact of the second referee in the National Hockey League, including the indirect impact of the second referee on in-arena attendance and national television audiences. During the 1998–1999 and 1999–2000 seasons, the second referee improved scoring, reduced fighting and penalty minutes but had no measurable impact on closeness of competition. In-arena attendance, a source of non-shared revenue for team owners, was not influenced by improved scoring or reduced fighting. On the other hand, national television viewership increased with expected scoring. The empirical results allow for an initial comparison of the benefits and costs of the second referees to the league. While it seems unlikely that any team would have unilaterally paid for all of the second referees, the benefits of the second referee seemed to have outweighed the costs. Therefore, the NHL's decision to introduce a second referee may have solved a free-rider problem while providing profit potential for NHL franchises.
Review of Industrial Organization – Springer Journals
Published: Oct 18, 2004
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