How to produce the belief in clean sports which sells

Abstract

Organisers of sport competitions sell a product, consisting of athletes’ performance and integrity of competition. These components are consumed simultaneously. Consumer demand for elite sport is at its highest when athletes perform at a high level and when consumers can believe in the athletes’ compliance with the rules. Anti-doping tests are needed because doping cannot be observed directly by consumers but only through the results of doping tests. However, if tests catch too many guilty deviators, consumer belief in the athletes’ compliance diminishes. Organisers of sporting events must decide on the intensity of testing in order to stabilise consumer demand. Intensive testing has the potential to deter athletes from using illicit substances or methods, thus leading to a low rate of detected athletes. A low rate of tests will deter fewer athletes from doping, but will also lead to a low number of detected athletes. Both strategies support consumer belief in compliance with the rules but have differing impact on athletes’ performance. Using a formal model and conducting a numerical simulation, we show that the present rate of about 2% adverse analytical findings is optimal for maximising the economic value of the competition for consumers, organisers, and athletes. Additionally, we show that the maximum utility of a low test rate can be changed if some specific but implausible criteria are met.