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The Origin of the Reserve Clause

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  • E. Woodrow Eckard

    (University of Colorado at Denver)

Abstract

This article examines the creation of the first professional athletic labor market restriction over a century ago. In 1879, professional baseball club owners mutually agreed that each could reserve five players whom the others would not sign without permission, justifying the action by claiming that it was in the “public interest,†that is, necessary to preserve the game in the face of various alleged problems. Analysis of the relevant data reveals that these problems were either nonexistent or easily solved within the game’s existing rule structure. Given the lack of support for the public interest arguments proffered by owners, the more likely motive for the reserve rule was monopsonistic collusion.

Suggested Citation

  • E. Woodrow Eckard, 2001. "The Origin of the Reserve Clause," Journal of Sports Economics, , vol. 2(2), pages 113-130, May.
  • Handle: RePEc:sae:jospec:v:2:y:2001:i:2:p:113-130
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    Cited by:

    1. Martin Schmidt, 2011. "Institutional Change and Factor Movement in Major League Baseball: An Examination of the Coase Theorem’s Invariance Principle," Review of Industrial Organization, Springer;The Industrial Organization Society, vol. 39(3), pages 187-205, November.
    2. Pelnar, Gregory, 2007. "Antitrust Analysis of Sports Leagues," MPRA Paper 5382, University Library of Munich, Germany.
    3. Eckard, E. Woodrow, 2005. "Team promotion in early major league baseball and the origin of the closed sports league," Explorations in Economic History, Elsevier, vol. 42(1), pages 122-152, January.

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