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Labor Markets and National Culture: Salary Determination in Japanese Baseball

Author

Listed:
  • Michael A Leeds

    (Department of Economics, Temple University, Philadelphia, PA 19122, USA)

  • Sumi Sakata

    (Temple University School of Law, Tokyo, Campus, Mita Hall, 4–1–27 Mita, Minato-ku, Tokyo 108–0073, JAPAN)

  • Peter von Allmen

    (Department of Economics, Skidmore College, Harder Hall, Saratoga Springs, NY 12866, USA)

Abstract

We analyze the determinants of salaries for players in Nippon Professional Baseball (NPB) using performance data from 2004 to 2006 and compensation data from 2005 to 2007. We find that salaries in NPB are determined by different factors than those that drive salaries in Major League Baseball (MLB). We also find that experience plays a significant role in salary determination, which suggests that the Japanese emphasis on seniority still holds in NPB. Finally, we show that free agency has relatively little impact on salaries in NPB, which suggests that players in NPB are subject to greater monopsony power than players in MLB.

Suggested Citation

  • Michael A Leeds & Sumi Sakata & Peter von Allmen, 2012. "Labor Markets and National Culture: Salary Determination in Japanese Baseball," Eastern Economic Journal, Palgrave Macmillan;Eastern Economic Association, vol. 38(4), pages 479-494.
    • Handle: RePEc:pal:easeco:v:38:y:2012:i:4:p:479-494
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    Cited by:

    1. Kelly E. Carter, 2018. "The Effect of Labor-Management Complementarities on Production and Efficiency When Management Is Paid but Labor Is Not Paid," Eastern Economic Journal, Palgrave Macmillan;Eastern Economic Association, vol. 44(4), pages 535-557, September.
    2. Wen-Jhan Jane, 2021. "The impact of cultural distance on salary: the case of Samurai Japan," Eurasian Economic Review, Springer;Eurasia Business and Economics Society, vol. 11(1), pages 85-123, March.

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