Information theory and municipal policy in sport: Empirical evidence from an Israeli case study

Information theory¹ explains how leaders attain a net electoral advantage when adopting a policy that favours the interests of the knowledgeable minority at the expense of the uninformed minority, even though the consequent loss incurred by the public exceeds any advantage accrued by the interested minority. This study investigates the empirical implications of the theory through a case study in Israel. The study focuses on the disproportionately large subsidies granted by local authorities to privately owned professional sports teams (PSTs). These grants are made despite the preference of municipal residents and professional administrators for spending more on popular sports rather than professional sports. In the belief that such actions occurred due to an asymmetry in information that favoured the interested minority, we collected information about the subsidies for PSTs and made it publically available. We then documented the process by which the subsequent changes in the municipal policy developed.