By Dr. Kjetil K. Haugen
April 1, 2011
In this short note, I enhance the discussion of legalizing performance enhancing drugs brought up by Savulescu, Foddy and Clayton through applying some simple economic theoretic arguments. I claim that Savulesu et al. fail to see some evident economic arguments, and hence very well may reach an erroneous conclusion.
1 My intention
Oxford Professor J. Savulescu and colleagues B. Foddy and M. Clayton, published a paper titled Why we should allow performance enhancing drugs in sport  (BJSM 2004). The authors argued strongly, not surprisingly taking the title into account, for legalizing performance enhancing drugs (PEDs).
I remember after reading their article, back in 2004, a somewhat awkward feeling to the contents in general, and my personal role in particular. I thought about writing a comment back then, but due to more urgent creative projects, I did not pursue the idea. However, after witnessing professor Savulescu on national Norwegian TV and other media  arguing strongly for his case, I have decided to open my mouth on the matter.
Previous work of mine seems to play a certain part in Savulescu et al.’s arguments in their article. My article, The performance-enhancing drug game  published in Journal of Sports Economics in 2004, and cited by Savuelscu et al., may to some extent be perceived as a support for the conclusion of Savulescu et al. I agree on the fact that my article predicts problems in fighting PED-use among professional athletes. However, problems in fighting do not equate legalizing.
My main point in writing The performance-enhancing drug game was actually to help fight drug abuse, not legalize it. So, in order to not be associated with Savulescu’s personal international vendetta (at least that is what it seems like observed from outside), I use this opportunity to state that I do not agree that we should legalized PEDs in sport. If my previous work  has led Savulescu and others to believe so, I hereby declare the opposite.
2 Savulescu et al.’s (missing) arguments
Now, after stating what I mean on this matter, let me also spend a tiny bit of time trying to argue why. In spite of the fact that I (and others) have shown the immense difficulty in fighting doping, there are – in my opinion – certain reasons for not legalizing it. Unfortunately, these reasons are not even mentioned by Savulescu et al., and I sincerely feel that they need to be.
In my opinion, general sports economic theory may prove handy as a tool to enhance the arguments used by Savulescu et al. In (sports) economic theory, the concept of markets plays a vital role. In order to have a market, both buyers (demanders) and sellers (suppliers) are needed for transactions. According to Savulescu et al.’s argumentation, which contains no reference to supply or demand, it is easy to assume that these topics are either uninteresting or unaffected by legalization of PED. I do not believe so.
Firstly, let me focus on the demand side. The question to ask then seems obvious. How and in what way may demand be affected by legalizing PEDs? Surely, this question is hard to answer, but it should be asked and at least discussed in order to judge such a radical proposition. Personally, I do not believe that demand is unaffected. On the contrary I think demand will be affected, and perhaps adversely. Savulesu et al. argue for fairness, safety and to some extent (as a consequence) more uncertainty of outcome. (quote: «By allowing everyone to take performance enhancing drugs, we level the playing field. We remove the effects of genetic inequality». After all, if all athletes are able to equate genetic differences by individually optimal PED use, a reasonable outcome should be more even competition. And yes, more even competition (or higher uncertainty of outcome as sports economists like to name it) has a positive demand effect. Fans like to watch sports competitions where at least some probability of the underdog winning exists. However, and this is perhaps the main point, sports fans also demand more than uncertainty of outcome. They demand excellence. 90.000 people at Nou Camp also come to watch Barcelona play wonderful football, not necessarily only the uncertainty related to the match outcome. Some fans might even state that the outcome of the match is subordinate to the beauty of Barcelona’s passing. Excellence is a relative measure. If everybody plays like Barcelona, Barcelona is no longer excellent. Hence, maximizing uncertainty of outcome does not (necessarily) maximize total sports demand. Then, it may very well be that a more even playing field attracts some fans but then also repels other. The question then boils down to the total effect which very well may be negative. After all, most sports economic experts recognize uncertainty of outcome as a positive demand effect, but most would probably agree on the fact that other effects, including excellence, may be far more significant.
Furthermore, the difference between knowing and expecting is not at all discussed. If PEDs are legalized, fans know that all athletes use certain (now) legal substances in order to enhance performance. Today, I might expect that all 8 runners in the Olympic 100 meters final have used steroids. However, there is a difference between expecting and knowing. Personally, I would definitely not find this information to be a demand booster. Obviously, this argument is relatively unscientific, but still, I believe it to be of some importance.
Secondly, and in my opinion, of greater importance is the supply side. Sports suppliers are of course athletes and teams, producing the sports products. However, the supply chain is a bit more complex than that. Efficient supply of the sports product also involves parents, coaches and volunteers and to some extent public subsidies as necessary production input. In this chain of production input, I believe that parents are the really vital part. If parents become reluctant in allowing their kids to do sport activities, in the long run a possible sports market collapse should be the outcome. No supply of talent leads to no demand, and hence no professional sports markets. Frankly, I might be skeptical today of sending my kids to sprint training, but with legalized PEDs, any reasonable parent would never even judge recommending such activities for their kids knowing that success in the long run would lead to PED use. Obviously there are unreasonable parents out there, but hopefully still in minority.
Finally, it seems plausible just to mention that most professional sports activity to a great extent also generates revenues through both public and private sponsors. I will not dive into the private sponsor market here, but mainly mention that the classical argument for public sports financing is related to positive external effects — typically health-wise. Still, even if professional sports are considered unhealthy, youth non-professional sporting activities are considered healthy and hence obliged to receive public money. I must say I am very pessimistic on keeping this stream of money running at the same speed into sports given legalized use of PEDs.
Failing to consider obvious economic effects both on demand and perhaps especially on the supply side makes Savulescu et al.’s arguments somewhat too simplified. I might agree that legalizing PEDs may prove both fairer and safer, but it may very well be that aiming for fairness and safety may lead to a total breakdown of professional sports markets as we see them today. I would not sit still observing this. So my medicine would be to do what I tried to state in previous work. Increase penalties for drug-taking behavior, make prize-functions less progressive and of course; increase quality of drug tests.
 K. K. Haugen. The performance-enhancing drug game. Journal of Sports
Economics, 5:67-86, Feb. 2004.
 J. Rasmussen. Oxford-professor vil legalisere doping. Dagbladet
(Norwegian Newspaper), Retrieved from the Internet – April 2011
 J. Savulescu, B. Foddy, and M. Clayton. Why we should allow performance enhancing drugs in sport. British Journal of Sports Medicine, 38:666-670,2004.
 Corresponding author. E-mail: Kjetil.Haugen@himolde.no
 Molde University College, Specialized University in Logistics, Box 2110, 6402, Molde,NORWAY
 Thanks to Prof. H. Gammelseter at Molde University College for valuable comments, discussion and reading through the
 Being a true sports fan, I would definitely not like that to happen.