The NBA’s Maximum Player Salary and the Distribution of Player Rents
The NBA’s 1999 Collective Bargaining Agreement (CBA) included provisions capping individual player pay in addition to team payrolls. This study examines the effect the NBA’s maximum player salary on player rents by comparing player pay from the 1997–1998 and 2003–2004 seasons while controlling for...
| Main Authors: | , |
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| Format: | Article |
| Language: | English |
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MDPI AG
2015-03-01
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| Series: | International Journal of Financial Studies |
| Subjects: | |
| Online Access: | http://www.mdpi.com/2227-7072/3/2/75 |
| _version_ | 1819229626156711936 |
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| author | Kelly M. Hastings Frank Stephenson |
| author_facet | Kelly M. Hastings Frank Stephenson |
| author_sort | Kelly M. Hastings |
| collection | DOAJ |
| description | The NBA’s 1999 Collective Bargaining Agreement (CBA) included provisions capping individual player pay in addition to team payrolls. This study examines the effect the NBA’s maximum player salary on player rents by comparing player pay from the 1997–1998 and 2003–2004 seasons while controlling for player productivity and other factors related to player pay. The results indicate a large increase in the pay received by teams’ second highest and, to a lesser extent, third highest paid players. We interpret this result as evidence that the adoption of the maximum player salary shifted rents from stars to complementary players. We also show that the 1999 CBA’s rookie contract provisions reduced salaries of early career players. |
| first_indexed | 2024-12-23T11:16:10Z |
| format | Article |
| id | doaj.art-4bf909cc87ba43efb76840a7787ab154 |
| institution | Directory Open Access Journal |
| issn | 2227-7072 |
| language | English |
| last_indexed | 2024-12-23T11:16:10Z |
| publishDate | 2015-03-01 |
| publisher | MDPI AG |
| record_format | Article |
| series | International Journal of Financial Studies |
| spelling | doaj.art-4bf909cc87ba43efb76840a7787ab1542022-12-21T17:49:13ZengMDPI AGInternational Journal of Financial Studies2227-70722015-03-0132758310.3390/ijfs3020075ijfs3020075The NBA’s Maximum Player Salary and the Distribution of Player RentsKelly M. Hastings0Frank Stephenson1Department of Economics, Berry College, Box 5024, Mount Berry, GA 30149, USADepartment of Economics, Berry College, Box 5024, Mount Berry, GA 30149, USAThe NBA’s 1999 Collective Bargaining Agreement (CBA) included provisions capping individual player pay in addition to team payrolls. This study examines the effect the NBA’s maximum player salary on player rents by comparing player pay from the 1997–1998 and 2003–2004 seasons while controlling for player productivity and other factors related to player pay. The results indicate a large increase in the pay received by teams’ second highest and, to a lesser extent, third highest paid players. We interpret this result as evidence that the adoption of the maximum player salary shifted rents from stars to complementary players. We also show that the 1999 CBA’s rookie contract provisions reduced salaries of early career players.http://www.mdpi.com/2227-7072/3/2/75NBAmaximum player salary1999 collective bargaining agreementrookie contract |
| spellingShingle | Kelly M. Hastings Frank Stephenson The NBA’s Maximum Player Salary and the Distribution of Player Rents International Journal of Financial Studies NBA maximum player salary 1999 collective bargaining agreement rookie contract |
| title | The NBA’s Maximum Player Salary and the Distribution of Player Rents |
| title_full | The NBA’s Maximum Player Salary and the Distribution of Player Rents |
| title_fullStr | The NBA’s Maximum Player Salary and the Distribution of Player Rents |
| title_full_unstemmed | The NBA’s Maximum Player Salary and the Distribution of Player Rents |
| title_short | The NBA’s Maximum Player Salary and the Distribution of Player Rents |
| title_sort | nba s maximum player salary and the distribution of player rents |
| topic | NBA maximum player salary 1999 collective bargaining agreement rookie contract |
| url | http://www.mdpi.com/2227-7072/3/2/75 |
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