Parity (sports)

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Parity in sports is defined as attempting to make an equal playing field for all participants, specifically with regard to financial issues. When parity in a sports league is achieved, all participating teams enjoy roughly equivalent levels of talent. In such a league, the "best" team is not exponentially better than the "worst" team. This leads to more competitive contests where the winner cannot be easily predicted in advance. Such games are more entertaining and captivating for the spectators. The opposite condition, which could be considered "disparity" between teams, is a condition where the elite teams are so much more talented that the lesser teams are hopelessly outmatched.

Different major governing organizations attempt to acheive parity in different ways. For example, the NFL has established the shared revenue plan, in which all teams equally benefit from television revenue and sales of NFL franchised goods.

Many consider the NFL to be the most "fair" or competitive league, with many different teams having a chance to win each year. In the NFL, complete parity would be a state where on any given Sunday, any given team can win any given game.

Salary cap limits set a maximum amount of money that may be spent on athletes' contracts. These limits exist to different extents in several other leagues as well. For example, MLB has cap limits, but allows for teams to go over the limit if they are willing to pay a luxury tax. This creates great inequality between the teams as a few have cap sizes in excess of 300% more than the smaller teams. This gives them an obvious competitive advantage in the ability to sign the best free agents on the market, and over a long enough time period a major competitve advantage . ^{[citation needed]}