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Do NFL Player Earnings Compensate for Monopsony Exploitation in College?

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  • Robert Brown

Abstract

This paper examines the extent to which a college player’s future income in professional football offsets his monopsony exploitation experienced at the college level. Stated differently, it attempts to measure whether a future NFL draftee's professional earnings compensates for his monopsony-induced loss in income at the college level. This is an important issue in the debate surrounding compensating college players, opposed by many on grounds that the top college players ultimately receive lucrative financial rewards as professionals. First, this paper uses a quantile regression method to account for differences in player marginal revenue products across college teams with different revenue-generating capabilities; for instance, players at high-revenue college teams produce higher marginal revenue products and thereby experience greater degrees of monopsony exploitation to overcome at the professional level. Next, it approximates professional players' earning profiles using NFL salary data, and then weighs these earnings against a player's foregone college compensation resulting from monopsony-induced restrictions in college football. The results indicate that between 33 and 38 percent of this sample of players (active and inactive) will earn NFL incomes sufficient to offset their monopsony-lost college earnings: A handful of these NFL players earn huge net surpluses but most can expect more modest net earnings.

Suggested Citation

  • Robert Brown, 2012. "Do NFL Player Earnings Compensate for Monopsony Exploitation in College?," Journal of Sports Economics, , vol. 13(4), pages 393-405, August.
    • Handle: RePEc:sae:jospec:v:13:y:2012:i:4:p:393-405
    DOI: 10.1177/1527002512450266
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    References listed on IDEAS

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    1. Roger Koenker & Kevin F. Hallock, 2001. "Quantile Regression," Journal of Economic Perspectives, American Economic Association, vol. 15(4), pages 143-156, Fall.
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    3. Robert Brown, 2011. "Research Note: Estimates of College Football Player Rents," Journal of Sports Economics, , vol. 12(2), pages 200-212, April.
    4. Long, James E & Caudill, Steven B, 1991. "The Impact of Participation in Intercollegiate Athletics on Income and Graduation," The Review of Economics and Statistics, MIT Press, vol. 73(3), pages 525-531, August.
    5. Andrew Zimbalist, 2010. "Reflections on Salary Shares and Salary Caps," Journal of Sports Economics, , vol. 11(1), pages 17-28, February.
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    2. Peter K. Hunsberger & Seth R. Gitter, 2015. "What is a Blue Chip Recruit Worth? Estimating the Marginal Revenue Product of College Football Quarterbacks," Journal of Sports Economics, , vol. 16(6), pages 664-690, August.
    3. Roger D. Blair & Wenche Wang, 2018. "The NCAA Cartel and Antitrust Policy," Review of Industrial Organization, Springer;The Industrial Organization Society, vol. 52(2), pages 351-368, March.

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