Effect of Transfer Fee Spending on Performance of Selected Football Clubs in Tanzania
Purpose: This study investigated the relationship between transfer spending and team performance in the Tanzanian Premier League, focusing on five clubs across eight seasons.
Design/Methodology/Approach: This study employed a panel data design to examine the relationship between transfer spending and sporting performance among Tanzanian Premier League clubs from. Using a Panel Vector Autoregressive (PVAR) model and Granger causality tests, it examined three dimensions of financial outlay: total transfer spending, premium player value, and average spending per player.
Findings: The findings showed that total spending had limited predictive power, significantly influencing only matches won (F = 3.87, p = 0.028), while failing to affect league position or CAF progression. In contrast, both premium player value and average spending per player demonstrated consistent Granger-causal relationships across all performance metrics. Premium investment significantly influenced matches won (F = 6.21, p = 0.004), league position (F = 5.43, p = 0.007), and CAF progression (F = 4.76, p = 0.012), while average spending also showed significant effects (e.g., F = 4.12, p = 0.019 for matches won).
These results highlight the strategic importance of targeted, efficient investment in high-impact players.
Originality: This study provides new insight in to elite leagues and overlook challenges in contexts of Tanzania. To understand how spending affected league results, match outcomes, and CAF progression, causal methods and context-specific data were essential.
Practical implications: The research offers valuable guidance to Investors, sponsors and policy makers gain clearer indicators of how transfer fee spending impacts club performance and brand value, enabling more informed decisions on financial support and strategic partnerships
Social implications: The study emphized on socital benefit by supports long-term performance planning in Tanzanian football, encouraging ambitious yet prudent transfer strategies. By linking financial investment to sporting success, the research enhances the professionalism and competitiveness of football in Tanzania and other emerging markets
Keywords: transfer spending, team performance, Tanzanian Premier League, five clubs across eight seasons, efficient investment
