Top Economist Casts Doubt On LIV Golf's Survival Chances

Economics author and professor Steve Levitt is unsure whether LIV Golf will survive beyond a couple more years

Greg Norman at the 2022 LIV Golf Chicago event
Greg Norman's LIV Golf may struggle to survive beyond a couple of years, according to Steve Levitt
(Image credit: Getty Images)

An economist who spoke to LIV Golf CEO Greg Norman at length about the venture has cast doubt on its ability to survive for longer than a couple of years.

Steve Levitt spoke to Norman on his People I (Mostly) Admire podcast, but in his summary of the conversation, he admitted he thinks the franchise model being pursued by LIV Golf is flawed.

Levitt began with the positives, pointing to the way the added competition at the top of the game has forced the PGA Tour to change its own product, including the upcoming TGL, which is being launched in partnership with the Tour.

He said: “On the question of LIV Golf making the world a better place, my own personal opinion is that yes, competition is good. It spurs innovation. And, ultimately, I suspect it will be a benefit to golf fans. Because not only is LIV Golf trying out all sorts of new things, but the PGA Tour is innovating also, like with the new Monday night team matches, slated to start in 2024.”

One of the big innovations of LIV Golf is its franchise model, which allows captains of its 12 teams an equity stake in them and the opportunity to attract interest from sponsors. However, Levitt expressed doubts over whether it will succeed and predicted a relatively short shelf life for the circuit. He said: “On the question of LIV Golf’s economic viability, well, there I’m a little more skeptical. I just don’t see the franchise model working, at least in its current form. In that case, I don’t think LIV will survive more than a couple years.”

LIV is noticeably pushing the team aspect in the early stages of the 2023 season, and a report from Alan Shipnuck, who also claimed LIV would stop paying travel expenses for players and caddies, revealed that rather than the money won by teams going into the pockets of the players, it will instead be invested in the teams to help grow the franchises.

Norman also detailed the model during the discussion with Levitt, saying: "So we have 12 principal players. Those 12 principal players own 25 percent of that franchise. The league owns 75 percent of it. Now that principal player is responsible for his own P&L over his team. No different than any NFL team, right? They’re responsible for their own P&L - profit and loss. So he has to bring in individuals to help him manage his team.”

Considering there has only been one tournament of 14 so far this year, it's too early to know whether the franchise model will capture the imagination of fans and sponsors alike, and Levitt was also careful to add a caveat to his opinion, explaining he his been wrong before. He said: “I’m also the one who said Amazon would never make a profit and that electric vehicles, they’d never be viable, and that Bitcoin, when its price reached 10, it was definitely a bubble. Even after the crash in 2022, the price of Bitcoin is 2,000 times higher today than when I confidently declared it a bubble. So my opinion is probably worth, well, nothing.”

However, given Levitt’s economic background, which includes co-authoring a bestselling book on the subject, Freakonomics, and holding the role of William B. Ogden Distinguished Service Professor of Economics at the University of Chicago, his opinion can’t easily be dismissed.

Mike Hall
News Writer

Mike has over 25 years of experience in journalism, including writing on a range of sports throughout that time, such as golf, football and cricket. Now a freelance staff writer for Golf Monthly, he is dedicated to covering the game's most newsworthy stories. 

He has written hundreds of articles on the game, from features offering insights into how members of the public can play some of the world's most revered courses, to breaking news stories affecting everything from the PGA Tour and LIV Golf to developmental Tours and the amateur game. 

Mike grew up in East Yorkshire and began his career in journalism in 1997. He then moved to London in 2003 as his career flourished, and nowadays resides in New Brunswick, Canada, where he and his wife raise their young family less than a mile from his local course. 

Kevin Cook’s acclaimed 2007 biography, Tommy’s Honour, about golf’s founding father and son, remains one of his all-time favourite sports books.