In 1964 Walter Neale presented the Louis-Schmeling paradox. Named after two World War II-era heavyweight champions, the Louis-Schmeling paradox describes sports business as different from any other business when it comes to the potential benefit of a monopoly.
Generally speaking, monopoly is the ideal market position of any given business. Under a monopoly, competition is either comparatively weak or non-existent. This position allows the dominant business to absorb the lion’s share of potential customers. However, the same position is detrimental to a prize fighter. As the old adage “it takes two to tango” implies, Joe Louis could not sell out a big fight venue without formidable competition such as Max Schmeling.
