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Reflections on Salary Shares and Salary Caps

Author

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  • Andrew Zimbalist

    (Department of Economics, Smith College, Northampton, MA, USA, AZIMBALI@smith.edu)

Abstract

This article takes a closer look at salary and revenue figures for the four major professional sports in the United States. It shows that the reporting typically offered in the popular media and often picked up in academic work can be rather misleading. The article first considers the conundrums in defining player compensation and then those connected to revenue. On the basis of adjusted data, the article proceeds to look at salary shares in revenue across the four leagues and considers the irony that the salary share in Major League Baseball (MLB) appears to be lower than the three leagues with a salary cap, the National Football League (NFL), National Basketball Association (NBA), and National Hockey League (NHL). It concludes with some analysis of the impact of salary caps and other mechanisms on controlling player costs.

Suggested Citation

  • Andrew Zimbalist, 2010. "Reflections on Salary Shares and Salary Caps," Journal of Sports Economics, , vol. 11(1), pages 17-28, February.
    • Handle: RePEc:sae:jospec:v:11:y:2010:i:1:p:17-28
    DOI: 10.1177/1527002509354890
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    Citations

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    Cited by:

    1. Robert Brown, 2011. "Research Note: Estimates of College Football Player Rents," Journal of Sports Economics, , vol. 12(2), pages 200-212, April.
    2. Robert Brown, 2012. "Do NFL Player Earnings Compensate for Monopsony Exploitation in College?," Journal of Sports Economics, , vol. 13(4), pages 393-405, August.
    3. Masaki Fujimoto, 2023. "A Dynamic Analysis of Equal Revenue Sharing and Endogenous Salary Caps in the N-Team Leagues," Journal of Sports Economics, , vol. 24(5), pages 624-638, June.
    4. Brian L. Goff & H. Youn Kim & Dennis P. Wilson, 2017. "Estimating the market value of collegiate football players from professional factor shares," Applied Economics Letters, Taylor & Francis Journals, vol. 24(4), pages 233-237, February.
    5. James Richard Hill & Nicholas A. Jolly, 2017. "Revenue Sharing and Player Salaries in Major League Baseball," Journal of Sports Economics, , vol. 18(8), pages 831-849, December.
    6. Rockerbie, Duane & Easton, Stephen, 2019. "A Real Options Approach to Multi-Year Contracts in Professional Sports," MPRA Paper 93062, University Library of Munich, Germany.

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