Salary Dispersion and Nationality Dispersion within Team Performance in the English Premier League

This paper explores the relationship between salary dispersion, nationality dispersion and team performance in the English Premier League (EPL). Team performance will be measured by points earned throughout the season. I hypothesize that teams with higher salary dispersion and higher nationality dispersion typically perform better because of superstars, since superstars play a big role in football and some relevant skills and knowledge sets might be nation specific. Superstar players also create high salary dispersions on their respective teams, and being superstars, they contribute largely to team success. This study will encompass all 20 EPL teams over the past 5 seasons, 2013-2014 to 2017-2018. Analysis of this paper indicates that on-field success can be directly related to players' skills and abilities and that wage expenditure and team diversity are positively related to team performance. One interpretation of this evidence is that investment in players' skills and ability buys on-field success, with richer teams becoming ever richer and able to maintain or even build upon success by spending more on players than less successful clubs.