Leveling the playing field: The distributional impact of maximum‐ and minimum‐level contracts on player compensation

Scott M. Kaplan

Contemporary Economic Policy, 2024, vol. 42, issue 2, 375-391

Abstract: How does the presence of maximum‐ and minimum‐level contract restrictions impact (i) superstar compensation and (ii) the distribution of compensation across an industry? Using ticket price and observed player talent data from the National Basketball Association (NBA), I estimate expected salaries for each player as well as their value to the NBA as a whole. I find the ratio of actual to expected salary is 2.8%–56.9% for the most talented players, resulting in subsidization to less talented players. The findings also suggest the most talented players generate significantly more value to the NBA than their actual and expected salaries.

Date: 2024
References: View references in EconPapers View complete reference list from CitEc
Citations:

Downloads: (external link)
https://doi.org/10.1111/coep.12621

Related works:
This item may be available elsewhere in EconPapers: Search for items with the same title.

Export reference: BibTeX RIS (EndNote, ProCite, RefMan) HTML/Text

Persistent link: https://EconPapers.repec.org/RePEc:bla:coecpo:v:42:y:2024:i:2:p:375-391

Ordering information: This journal article can be ordered from
https://ordering.onl ... 5-7287&ref=1465-7287

Access Statistics for this article

Contemporary Economic Policy is currently edited by Brad R. Humphreys

More articles in Contemporary Economic Policy from Western Economic Association International Contact information at EDIRC.
Bibliographic data for series maintained by Wiley Content Delivery ().