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Testing the Determinants of Income Distribution in Major League Baseball

  • R. Todd Jewell
  • Michael A. McPherson
  • David J. Molina
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    Using data from U.S. Major League Baseball, this article compares parametric and nonparametric Gini coefficients for each team and year. We employ a panel-data model to investigate the time-series and cross-sectional factors affecting the Gini coefficients and the parameters of the preselected distribution. We find that much of within-team income distribution is determined by time-related variables, with the 1994 MLB strike having an especially strong effect. A team's market potential does not seem to affect its salary distribution, but the average age of the players on a team's roster does. Furthermore, inequality first increases with team payroll, then decreases before increasing again. (JEL D31, L83) Copyright 2004, Oxford University Press.

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    File URL: http://hdl.handle.net/10.1093/ei/cbh074
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    Article provided by Western Economic Association International in its journal Economic Inquiry.

    Volume (Year): 42 (2004)
    Issue (Month): 3 (July)
    Pages: 469-482

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    Handle: RePEc:oup:ecinqu:v:42:y:2004:i:3:p:469-482
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