The Influence of Players Contracts in Sport and Economic Performance of Brazilian Football Clubs

Objective: This study analyzes the influence of the representativeness of players’ contracts on financial and sports performance in Brazilian football clubs. Method: Based on the 2020 Brazilian Football Confederation rank, our sample comprises 29 teams covering the 2011-2021 period. We use the players' contracts registered in the intangible assets as our primary independent variable. We also subdivided this value into professional and young players. Results and Discussion: Results suggest that most big clubs invest more in professional players while small clubs in young players. Moreover, a higher investment proportion in players' contracts influences financial and sportive performance. This is mostly confirmed by the investment in professional players, whereas the investment in developing young players could not be confirmed. Contributions: Intangible assets play an important role in the overall success of football clubs, not only from a financial perspective but also in terms of their sporting achievements. This comprehensive study seeks to provide evidence that sheds light on the distinctive relationship between players' contracts and the subsequent impact on both the sporting and financial performance of Brazilian football clubs. Furthermore, it is worth noting that in Brazil, clubs have the unique advantage of being able to capitalize on costs associated with the development of young players, which is a distinctive setting to analyze.