Some owners were trying desperately to keep their clubs out of bankruptcy during the 1930s. One method of helping teams in small cities survive was through cross-subsidization, which was typically achieved through revenue sharing. Both leagues had gate-sharing rules. Did such rules provide much succor for struggling teams?
Many people believe gate sharing exists to redress inequalities in revenue and to promote competitive balance. Gate-sharing rules reflect the tension within a professional sports league. Owners are selfinterested, but they also have to consider the effects of their actions upon rival owners. While most industries winnow out the weak, modern sports leagues often prefer to maintain weak clubs. However, some owners, especially of successful teams, appear to downplay or disagree with the “helping the weak” argument. If you owned the New York Yankees, your attitude might be, “I should get a large piece of the pie when I visit Kansas City, since I’m bringing in a strong (well-paid), attractive club. When the Royals start bringing in a strong, well-drawing club to Yankee Stadium, I’ll be willing to share more revenue.”
The prevailing belief is still that revenue sharing exists to transfer money from wealthy teams (primarily in the biggest cities) to poorer teams (primarily in the smaller cities). Certainly the Great Depression era looms as an era in which revenue sharing would have been of utmost importance.