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Estimating the market value of collegiate football players from professional factor shares

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  • Brian L. Goff
  • H. Youn Kim
  • Dennis P. Wilson

Abstract

Although the level and growth of revenue in college football has drawn increasing public attention, reliable estimates of the value of college and associated rents remain elusive. Many players do not have easily observable performance statistics and there are significant complementarities. Using a simple estimation strategy based on professional factor shares and rooted in economic theory, we generate estimates of market value for college players across seven National Collegiate Athletic Association conferences using professional football and basketball salaries from 2011 to 2013 as shadow prices. With this method, market value of an average starting football player in a Bowl Championship Series (BCS) conference ranges from $120,000 to $1.7 million per year. The value of superstar players may exceed $4 million per year. We find that rents can flow from the institutions to players in some cases at relatively low-revenue institutions outside the BCS.

Suggested Citation

  • Brian L. Goff & H. Youn Kim & Dennis P. Wilson, 2017. "Estimating the market value of collegiate football players from professional factor shares," Applied Economics Letters, Taylor & Francis Journals, vol. 24(4), pages 233-237, February.
    • Handle: RePEc:taf:apeclt:v:24:y:2017:i:4:p:233-237
    DOI: 10.1080/13504851.2016.1178842
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    References listed on IDEAS

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    1. Lawrence M. Kahn, 1993. "Managerial Quality, Team Success, and Individual Player Performance in Major League Baseball," ILR Review, Cornell University, ILR School, vol. 46(3), pages 531-547, April.
    2. Acemoglu, Daron & Pischke, Jorn-Steffen, 1999. "Beyond Becker: Training in Imperfect Labour Markets," Economic Journal, Royal Economic Society, vol. 109(453), pages 112-142, February.
    3. Lawrence M. Kahn, 2007. "Markets: Cartel Behavior and Amateurism in College Sports," Journal of Economic Perspectives, American Economic Association, vol. 21(1), pages 209-226, Winter.
    4. Andrew Zimbalist, 2010. "Reflections on Salary Shares and Salary Caps," Journal of Sports Economics, , vol. 11(1), pages 17-28, February.
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    Cited by:

    1. Craig Garthwaite & Jordan Keener & Matthew J. Notowidigdo & Nicole F. Ozminkowski, 2020. "Who Profits From Amateurism? Rent-Sharing in Modern College Sports," NBER Working Papers 27734, National Bureau of Economic Research, Inc.
    2. Watanabe, Nicholas M. & Yan, Grace & Soebbing, Brian P., 2019. "Market disruption as a regime for athlete activism: An economic analysis of college football player protests," Sport Management Review, Elsevier, vol. 22(5), pages 600-612.
    3. Craig Garthwaite & Jordan Keener & Matthew Notowidigdo & Nicole Ozminkowski, 2020. "Who Profits from Amateurism? Rent-Sharing in Modern College Sports," Working Papers 2020-117, Becker Friedman Institute for Research In Economics.

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