Everyday there are more and more measures of player performance in every sport; and basketball is not an exception. Players’ actions are continuously observed in the attempt to break down in pieces the huge complexity of the game.
The purpose of the research will be to investigate the relationship between NBA salaries, the dependent variable, and a set of performance measures as independent variables: point scored per game, assists, steals, fouls, rebounds, years as a pro in the NBA, turnovers.
This study will inspect if and how the different independent variables contribute to the salary of the players, allowing us to determine which variables influence the pay most and which influence it less, in both a positive and a negative way.
The work is intended to provide a useful insight to better understand how players’ performances on the court impact on their income.
Literature review
For many years economists have been studying trying to understand the main components in salary determination in different professional sports.
For many years economists have examined and refined the understanding of salary determination in professional sports in various prospective
Our story starts with a review of the lessons the current body of literature teaches us about the economics of professional basketball.
Discrimination
Economists have become increasingly interested in the topic of discrimination in professional sports; and basketball is not an exception. The widely spread perception of the public has been that sports are an oasis of equal economic opportunities for minorities. This belief is strengthened by the fact that minority representation is higher in many major sports teams than in the labor force as a whole....
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...gated the relationship between wages and team success in a variety of sports, including the NBA. Although this relationship has been found to be statistically significant, only 16% of winning percentage was explained by relative payroll. A similar result was reported by Berri, Schmidt and Brooks (2004), after having analyzed payroll in the NBA across fifteen seasons they ended up with the result that relative payroll only explains 10% of the team wins.
Studies regarding individual player’s performance and player’s salary have differed mainly on the choice of which variable to include in the model. Each author proposes his own formula to better capture and explain the variability of
Another vector of studies that has found in the NBA a fertile ground of research has been that exploring the relationship occurring between pay inequality and worker performance.
One Sample Hypothesis Testing Paper Do Major League Baseball teams with higher salaries win more frequently than other teams? Although many people believe that the larger payroll budgets win games, which point does vary, depending on the situation. "performances by individual players vary quite a bit from year to year, preventing owners from guaranteeing success on the field. Team spending is certainly a component in winning, but no team can buy a championship."
Overall, compelling points exist supporting or not supporting a salary cap in baseball. Teams have the benefit of a salary cap existing, and out of that, a balance in free agency forms and a sense of championship parity develops too. On the other side of the spectrum, teams can use the Moneyball method of recruiting and signing players, along with tax implications and revenue sharing to balance out payrolls. The main factor in deciding if a salary cap is appropriate is the factor of fairness among the teams. Therefore, based off the support the research provides, the implementation of a salary cap is necessary.
By taking the labor market theory and MRP of players and analyzing how they interact with wage determination and competitive balance mechanisms we can make an economic analysis of the labor market inefficiencies. Giving us the ability to make some determinations on why labor market inefficiencies exist in professional sports and how/if there are any ways to correct for
If there’s one thing we dread in the summer more than the heat, it’s the afflicting sentiment that surrounds oneself when one is inhibited from experiencing the thrills of football for six long and gruesome months. National Collegiate Athletic Association (NCAA) football is a part of many Americans’ Saturdays, but to fewer does it mean their lives. Recently coming under debate, many sporting fans and college athletes believe that players should be paid more than just tuition, room, board, and books. Two articles on this issue that bring up valid points worth discussing are Paul Marx’ “Athlete’s New Day” and Warren Hartenstine’s “College Athletes Should Not Be Paid.” From these articles I have found on the basis of logical,
We will run regression analysis on how each independent variable affects the dependent variable individually and in total. The dependent variable is winning percentage, and the stats we measured were selected as the independent variables. The independent variables that we chose were: Field Goals per Game, Free Throws per Game, Assists per Game, Fouls per Game, Turnovers per Game, 3 Pointers per Game, Blocks per Game, Steals per Game & Rebounds per Game.
Although many youngsters fail in the NBA, there are a few high school players who have had, or do have a successful career in the NBA. Some of these are, Moses Malone, Kobe Bryant, Tracey McGrady, and this year’s most valu...
In the collegiate world of sports, basketball has become an increasingly recognized sport among African Americans, predominantly males. The hope of any young basketball player is that one day a scout will come and recruit them into stardom The question that presents itself as a problem to the lucky few who are chosen to go professional, is whether or not an education is more important than a million dollar shoe deal, “The NCAA's (1998) annual six-year study reported that only 33% of Black male basketball players graduated, (Chronicle of Higher Education, 1999). Individually, basketball reported the lowest graduation rate in all divisions,” (Robinson, 2004:1). Basketball players have become so idolized in the eyes of young Black male basketball athletes, that the value of education appear to be less important in the development of these young men, “According to Sailes (1997), there is an over-representation of Black males in particular sports and an under-representation in other segments of American society. He provides the example of percentages of Black males competing in the NBA (77%), NFL (65%), MLB (15%), and MLS (16%) in comparison to the fact that fewer than 2% of doctors, lawyers, architects, college professors, or business executives are Black males.”, (Robinson, 2004:1). The idea of the attainment of a professional basketball player’s salary in the NBA, without even having to go to school for the time it takes to earn a degree is very appealing to some players. Those with a wealthy, or even upper-middle class upbringing may not view material assets as a priority. In the Black community, we have theorized that money and success play a more important role than education in most households. Although these two seem to go together, one resulting from the other, this does not apply in the sports world. Our research will examine the role that the family value system plays in influencing Black vs. White male athletes to turn professional, as opposed to obtaining a college degree before turning professional.
Many NCAA basketball players who make the decision to enter the NBA are not mentally prepared to deal with the responsibilities of life in the NBA. Young players depend on others who influence them or help make bad life decisions. What the young players visualize as the reward for playing in the NBA is the big money and with that big money make many mistakes financially. In th...
Eitzen, D. Stanley. "College Athletes Should Be Paid." Sports and Athletes. Ed. James D. Torr.
Now Mr. Roberto Hinojosa contends that professional athletes are overpaid. Citing U.S. Household Income stats for 2012 he explains that teachers,
Staurowsky, Ellen J. The Price of Poverty in Big Time College Sport. Norco: National College Players Association, 2011.
effect by the NBA to put a limit on beginning salaries, so some measures are
The countering argument made to justify the pay disparity in women’s professional sports is the revenue generated by it male counter parts exceeds their total revenue validating why their wages were exceeding higher. This argument is getting outdated. Even though there may be some truth in that proposal the popularity in women’s sports continues to grow every single day. But the wages stay
The controversy of athletes being overpaid dates back to 1922, when well-known baseball player George “Babe” Ruth received $50,000 within the first year of his career. Ruth’s extensive wealth was bolstered by dozens of endorsements (Saperecom). As it is shown in figure 1, in the Fortunate 50 Tiger Woods takes the number one spot for highest paid athlete. Tiger’s salary for 2011 is $2,294,116 and like Babe Ruth, his endorsements exceed his salary earning $60,000,000 making his total $62,294,116 (Freedman). It’s crazy to think that 89 years ago professional athletes scarcely made more than the average person today. This is of course not counting the inflation that has occurred since the years which Babe Ruth played baseball.
While sports for the spectators are merely entertainment, the economics of the industry are what drives businesses to become involved. Sports have become more of a business entity rather than an entertainment industry due to the strong economic perception of the over all industry. There are several instances in which economics may contribute to the effect on the sports industry, such as: the success of a team, the price of a ticket, the amount of money an athlete will make, and the amount of profit a team will make. The success of an...