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Oliver Stanton
You may not think that there are valuable economic lessons to be learnt from the game of Cricket. However, you would be wrong.
The IPL is a 20 over format held annually in India which in recent years has gained massive global traction due, not only to its lofty standards of cricket, but to the excitement and fast paced action which I am told red ball cricket does not provide to many. The IPL is the fastest growing sport competition in the world, at 24% a year, which shows how it is staking its claim as one of the largest global sporting events. Now how does this relate to economics?
Don’t tell the IMF, but the IPL actually has a protectionist barrier in place to promote its homegrown players. Each team can only have eight of their twenty-five players brought in from abroad, and only four may play at any one time. Were you the owner of an IPL team, you would probably want as many foreign names as possible in order to attract foreign viewers and therefore revenue. However, the ‘import quotas’ of foreign players means domestic Indian players get developed at the highest level, and many get opportunities which otherwise they might not receive. As much as David Malpass, Head of the World Bank, might be desperate to smash the doors open and flood in hot-shot names, the quota has managed to survive.
Economically though, does it work? On the one hand, Indian players get experience and have the opportunity to compete at a top level where their position might have been taken by a more established player from a more competitive country. They might even improve their skills to the point they can go and dislodge a less skilful player of his sport in say, the Hundred competition in the UK, and thus promote Indian cricket abroad. The protection of the domestic supply in order to promote long-term competitivity and exports is a major cornerstone of protectionism.
However, at the same time, perhaps these players get lazy and fat because they know their spot in the team isn’t threatened by a faster, harder-working player from abroad. Even the quality of cricket in the league is not as high as it would be with all the incredibly talented players from abroad, leaving the fans dissatisfied. The loss of efficiency and stagnation of the market is the most significant argument against protectionism, especially that as blatant as a quota. If India cannot provide good enough high-quality cricket players, some teams will be left with below-par players, and those who do have the talent will become extremely expensive due to the artificial contraction of supply, a classic example of cost-push inflation.
There is also the risk of retaliation by other nations upset at their players being debarred. Maybe Rishi Sunak will throw a hissy fit and limit Indian players from playing in England, making the situation worse for everyone. Now realistically, no one can really question the quality of Indian cricket players, and I highly doubt that Sunak will destabilise relations with India over their limits on our questionable cricket players (I am not sure I would want them either). But it is an interesting, if slightly forced, way to look at protectionism.
Perhaps in the short term the IPL will lose its attraction, Kohli will put on a belly, and Rishi will declare war so he can watch Buttler on the television. But then perhaps in the long term we will also see a new generation of skilful and talented Indian cricketers dominating world cricket for decades to come, a product of the favourable circumstances and foresight of the IPL board which gave them the opportunity in the first place.
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