Lies, damn lies....and Sergio Aguero!

Dr Paul Cashian

Ms Sarah Brooke

Posted: July 23, 2014

This is a posting written by Dr Paul Cashian (with the spectator demand measure initially being proposed by his City supporting daughter, Sarah Brook).

Was Francis Lee better paid than Sergio Aguero?

A number of commentators noted the similarities between the denouement of the 2011/12 and the 1967/68 seasons. Going into the last day of the season the championship came down to a straight fight between City and United (I can never get use to the ‘Man’ suffix!) – City had to win their last game in 2012 and United theirs in 1968. Happily in both cases City emerged as champions – just!  City’s top scorer in 1968 was Franny Lee (16 goals) and in 2012 was Sergio Augero (23 goals).  Lee and Augero are actually very similar types of players, both playing as centre forwards but, being fairly stocky in build, not in the classic big target man mode.  Rummaging through some of my City memorabilia recently I found a copy of Lee’s original contract for City dating from 1967. It makes for fascinating reading and allows for some interesting comparisons between City’s two top scorers in the championship campaigns of 1967/68 and 2011/12.

The basic structure of a professional football contract has always been a mixture of a fixed weekly payment plus variable amounts based on a range of performance related targets, although Augero will be able to add in additional commercial related income not open to Lee. Lee’s contract follows this pattern. £60 per week plus various incentive payments based on, for example, an appearance fee, City’s weekly  league position plus fixed end of season sums based on progress in various competitions. The contract also, interestingly, has a variable amount based on match attendance ranging from £1 for 1,000 spectators over 20,000 to £2 for each 1,000 over 30,000. The variable amount of Augero’s contract is not a matter of public record, but his basic weekly wage on signing in 2011 was widely reported as £200,000 per week.

This data allows for some interesting rudimentary comparisons to be made. The average weekly wage in 1967 was £26 per week therefore Lee’s basic wage was roughly 2.3 times the average. By 2011 the average weekly wage had risen to £711 but Augero’s weekly wage is a massive 281.3 times the average! On the face of it this huge discrepancy looks difficult to justify, it’s debatable whether Augero is the better player but he is certainly not more than 100 times a better player.  So was Lee underpaid or is Augero overpaid?

Another way to approach this question is to apply some very basic demand and supply analysis. The supply of top class strikers we can confidently expect to be low and very close to perfectly inelastic which means that the ‘price’/wage will be largely dependent on demand. One proxy we could use for demand is the number of people watching a particular match – reflecting one of the variable elements in Lee’s contract. In both 1967/68 and 2011/12 the key games of the season proved to be those between City and United.  The total number of spectators at the two derby matches in both seasons was roughly the same at just over 120,000.  However the main demand difference in 2011/12 was the live screening of both games across the globe. It is estimated that a live Premier league game attracts an average global audience of 500 million so at least 1 billion TV spectators watched the two derby games in addition to the 120,000 in the ground.  Using a measure based on ‘live’ spectators therefore we can calculate that Lee was paid a basic wage of £1 per 1,000 for the 1967/68 derbies whereas Aguero was paid roughly 40p per 1,000 in 2011/12. In other words, on this demand calculation Lee is actually being paid 2.5 times more than Aguero in absolute terms never mind real terms! So reversing the previous question – was Lee overpaid or is Augero underpaid?

Interesting as this simple manipulation of statistics might be it doesn’t really tell us much other than that markets are dynamic and change over time, Lee and Augeros’ wage levels reflect the different market context in 1967 and 2011 respectively – nothing more. Just for the record of the four derby matches in the two seasons United won the Maine Rd derby in Sept 1967 (unfortunately I’m old enough to have been there) and City won the other three – including the 6-1 trashing at Old Trafford in Oct 2011. Happy Days!



About Dr Paul Cashian

Paul is Faculty Director of Learning and Teaching, Faculty of Business, Environment and Society, Coventry University.




About Sarah Brook

Sarah Brook is an associate at the law firm CMS Cameron McKenna where she specialises in advising financial services firms, particularly those that have attracted the attention of the Financial Conduct Authority and those involved in litigation proceedings.