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The Case for Paying College Athletes

Author

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  • Allen R. Sanderson
  • John J. Siegfried

Abstract

Big-time commercialized intercollegiate athletics has attracted considerable attention in recent years. Popularity of this uniquely American activity, measured by attendance, television ratings, or team revenues, has never been higher. At the same time, however, several high-profile scandals exposing unseemly behavior on the part of players, coaches, and even respected higher education institutions—as well as questions about the distribution of the enormous revenues pouring into university athletic departments—have marred the image of these college football and men's basketball programs. Currently there are several legal challenges to the National Collegiate Athletic Association (NCAA) and its member institutions that may change dramatically and permanently the arrangements between the NCAA cartel, its member colleges and universities, and the "student-athletes" who play on the teams. These challenges all focus on the NCAA's collective fixing of players' wages. We describe this peculiar "industry," detailing the numerous market imperfections in both output and labor markets, the demand for and supply of college athlete labor, and possible alternative arrangements in the college athlete labor market, including the ramifications of compensating players beyond the tuition, room, board, books, and fees that some current players already receive as grants-in-aid.

Suggested Citation

  • Allen R. Sanderson & John J. Siegfried, 2015. "The Case for Paying College Athletes," Journal of Economic Perspectives, American Economic Association, vol. 29(1), pages 115-138, Winter.
  • Handle: RePEc:aea:jecper:v:29:y:2015:i:1:p:115-38 Note: DOI: 10.1257/jep.29.1.115
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    References listed on IDEAS

    as
    1. Malcolm Getz & John Siegfried, 2010. "What Does Intercollegiate Athletics Do To or For Colleges and Universities?," Vanderbilt University Department of Economics Working Papers 1005, Vanderbilt University Department of Economics.
    2. Caroline M. Hoxby, 2014. "The Economics of Online Postsecondary Education: MOOCs, Nonselective Education, and Highly Selective Education," American Economic Review, American Economic Association, pages 528-533.
    3. Michael L. Anderson, 2012. "The Benefits of College Athletic Success: An Application of the Propensity Score Design with Instrumental Variables," NBER Working Papers 18196, National Bureau of Economic Research, Inc.
    4. Zuleta, Hernando & Young, Andrew T., 2013. "Labor shares in a model of induced innovation," Structural Change and Economic Dynamics, Elsevier, vol. 24(C), pages 112-122.
    5. Donald Alexander & William Kern, 2010. "Does Athletic Success Generate Legislative Largess from Sports-Crazed Representatives? The Impact of Athletic Success on State Appropriations to Colleges and Universities," International Journal of Sport Finance, Fitness Information Technology, vol. 5(4), pages 253-267, November.
    6. Devin G. Pope & Jaren C. Pope, 2009. "The Impact of College Sports Success on the Quantity and Quality of Student Applications," Southern Economic Journal, Southern Economic Association, vol. 75(3), pages 750-780, January.
    7. Brad R. Humphreys, 2006. "The Relationship Between Big-Time College Football and State Appropriations for Higher Education," International Journal of Sport Finance, Fitness Information Technology, vol. 1(2), pages 119-128, May.
    8. Erin Lane & Juan Nagel & Janet S. Netz, 2014. "Alternative Approaches to Measuring MRP," Journal of Sports Economics, , vol. 15(3), pages 237-262, June.
    9. Clotfelter,Charles T., 2011. "Big-Time Sports in American Universities," Cambridge Books, Cambridge University Press, number 9781107004344, December.
    10. Caroline M. Hoxby, 2014. "The Economics of Online Postsecondary Education: MOOCs, Nonselective Education, and Highly Selective Education," American Economic Review, American Economic Association, pages 528-533.
    11. Dennis Coates & Brad R. Humphreys & Li Zhou, 2014. "Reference-Dependent Preferences, Loss Aversion, And Live Game Attendance," Economic Inquiry, Western Economic Association International, vol. 52(3), pages 959-973, July.
    Full references (including those not matched with items on IDEAS)

    More about this item

    JEL classification:

    • I23 - Health, Education, and Welfare - - Education - - - Higher Education; Research Institutions
    • L83 - Industrial Organization - - Industry Studies: Services - - - Sports; Gambling; Restaurants; Recreation; Tourism

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