Pay, productivity and aging in Major League Baseball
AbstractUsing panels of player pay and performance from Major League Baseball (MLB), we examine trends in player productivity and salaries as players age. Pooling players of all ability levels leads to a systematic bias in regression coefficients. After addressing this problem by dividing players into talent quintiles, we find that the best players peak about two years later than marginal players, and development and depreciation of ability appear to be more pronounced for players with the highest peak ability levels. Within-career variation, however, is less pronounced than between-player variation, and the talent level of players within a given quintile will typically remain lower than the talent level for rookies in the next higher quintile. Free agents are paid proportionately with their production at all ability levels, whereas young players’ salaries are suppressed by similar amounts.
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Bibliographic InfoPaper provided by University Library of Munich, Germany in its series MPRA Paper with number 4326.
Date of creation: 31 Jul 2007
Date of revision:
Major League Baseball (MLB); career dynamics; player salaries and performance; quintile analysis;
Other versions of this item:
- Jahn Hakes & Chad Turner, 2011. "Pay, productivity and aging in Major League Baseball," Journal of Productivity Analysis, Springer, vol. 35(1), pages 61-74, February.
- L83 - Industrial Organization - - Industry Studies: Services - - - Sports; Gambling; Recreation; Tourism
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