The Economics of NASCAR

AbstractThis chapter presents a description and brief history of NASCAR, and also explores the economic logic of the NASCAR business model. It then provides a partial explanation, based on outcome uncertainty, about the popularity of NASCAR and why it has outpaced other professional sports competitors. NASCAR sanctions a number of local, regional, and national racing series. From an economic perspective, the consolidation was a watershed event in the history of NASCAR and its host tracks. NASCAR continued to split broadcast revenue as it had in the past: 65% going to the tracks, 25% going to the teams and drivers, and 10% going to NASCAR. Many factors contribute to NASCAR's growth in competing for consumer patronage against other sports and other forms of auto racing. Many analysts have contemplated why demand for NASCAR events has grown so dramatically over time.