Free Agency and the Concentration of Player Talent in Major League Baseball
AbstractThis article investigates whether the a removal of the reserve clause in professional baseball affected the concentration of player talent in the industry. After free agency, a few wealthy teams could purchase the best players over time, leading to a high concentration of productive players and adversely affecting the competitive nature of the industry. To investigate his possibility, the Herfindahl-Hirschman Index, and the deviation of the index from its ideal, for home runs, strike outs and runs scored is related to structural changes in professional baseball. Free agency reduced the concentration of home runs but not of strikeouts or runs scored. These findings are consistent with increased player mobility but not with monopolization by a minority of teams.
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Bibliographic InfoArticle provided by in its journal Journal of Sports Economics.
Volume (Year): 3 (2002)
Issue (Month): 4 (November)
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Find related papers by JEL classification:
- L83 - Industrial Organization - - Industry Studies: Services - - - Sports; Gambling; Restaurants; Recreation; Tourism
- J44 - Labor and Demographic Economics - - Particular Labor Markets - - - Professional Labor Markets and Occupations
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- Thomas J. Miceli, 2003. "A Principal-Agent Model of Contracting in Major League Baseball," Working papers 2003-01, University of Connecticut, Department of Economics.
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