Pricing Footraces in the United States: An Application of Hedonic Pricing to the Running Industry

Abstract

Footraces, as a market commodity, are a curious thing. Nonrunners often ask racers why they pay to engage in an activity that they could do on their own at a much lower cost (both in terms of money and time), not recognizing that races offer unique attributes obtainable only through organized events. Employing more than 1,200 observations from 199 running races that occurred in 2015, this analysis uses a standard hedonic pricing model to identify both demand and supply side factors that determine the final price of a race event across the United States. Results suggest that late registration, race distance, the existence of complementary distances within the race, and the inclusion of a race shirt and/or medal with the paid entry increase the price of the race. Early registration, the number of years a race has been in existence, and a nonpaved race surface have a negative and statistically significant effect on the entry fee. JEL Classifications: Z20, Z21