IDEAS home Printed from
   My bibliography  Save this article

Estimating Baseball Salary Equations from 1961-2005: A Look at Changes in Major League Compensation


  • Gary Stone

    () (Winthrop University)

  • Louis J. Pantuosco

    () (Winthrop University)


This study estimates Major League Baseball (MLB) player salaries for three distinct periods of time. The data from the first time period, 1961 through 1973, were collected in 1974, but analysis of that set has never been published. During that period the reserve clause was fully in effect. The second period, 1974 through 1983, captures the early years of arbitration and free agency. The third period, 1999 through 2005, represents the modern era. The estimates specify that the salary productivity elasticities have increased over time for slugging average, player durability, and player consistency; this result indicates that over time owners have placed more value on these measures of player productivity. The model also implies that teams located in more densely populated areas are better able to compensate their players, particularly their pitchers. We conclude that our model explains salaries well in the 1961-1973 and 1999-2005 periods, but the regression estimates reveal a less pronounced relationship between the marginal revenue product and MLB wages in the early years of arbitration and free agency (1974-1983).

Suggested Citation

  • Gary Stone & Louis J. Pantuosco, 2008. "Estimating Baseball Salary Equations from 1961-2005: A Look at Changes in Major League Compensation," International Journal of Sport Finance, Fitness Information Technology, vol. 3(4), pages 228-238, November.
  • Handle: RePEc:jsf:intjsf:v:3:y:2008:i:4:p:228-238

    Download full text from publisher

    File URL:
    Download Restriction: Full-text download requires subscription from FIT.

    As the access to this document is restricted, you may want to search for a different version of it.


    Citations are extracted by the CitEc Project, subscribe to its RSS feed for this item.

    Cited by:

    1. repec:eee:spomar:v:21:y:2018:i:2:p:189-201 is not listed on IDEAS

    More about this item


    labor; sports; wages; productivity; market structure; Major League Baseball;

    JEL classification:

    • L83 - Industrial Organization - - Industry Studies: Services - - - Sports; Gambling; Restaurants; Recreation; Tourism


    Access and download statistics


    All material on this site has been provided by the respective publishers and authors. You can help correct errors and omissions. When requesting a correction, please mention this item's handle: RePEc:jsf:intjsf:v:3:y:2008:i:4:p:228-238. See general information about how to correct material in RePEc.

    For technical questions regarding this item, or to correct its authors, title, abstract, bibliographic or download information, contact: (Victor Matheson). General contact details of provider: .

    If you have authored this item and are not yet registered with RePEc, we encourage you to do it here. This allows to link your profile to this item. It also allows you to accept potential citations to this item that we are uncertain about.

    We have no references for this item. You can help adding them by using this form .

    If you know of missing items citing this one, you can help us creating those links by adding the relevant references in the same way as above, for each refering item. If you are a registered author of this item, you may also want to check the "citations" tab in your RePEc Author Service profile, as there may be some citations waiting for confirmation.

    Please note that corrections may take a couple of weeks to filter through the various RePEc services.

    IDEAS is a RePEc service hosted by the Research Division of the Federal Reserve Bank of St. Louis . RePEc uses bibliographic data supplied by the respective publishers.