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An empirical investigation of wage discrimination in professional basketball

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  • Mark Gius
  • Donn Johnson

Abstract

Previous research has shown that wage discrimination may exist in National Basketball Association (NBA) player salaries. These studies have shown that African-Americans earned from nine to twenty per cent less than whites when on-court performance is held constant. The authors could find no substantial research that has been done in this area since 1991. The present study re-examines this issue. Using salary data from the 1996-97 season and performance statistics from the 1995-96 season, a log-linear wage equation was estimated, and a Chow Test was performed. Holding all other factors constant, African-American players do not earn less than white players. The most important factors affecting an NBA player's salary are on-court performance, free agency, experience, and the draft status of the player. These results are important since they indicate that wage discrimination based on race appears to have been eliminated from the NBA.

Suggested Citation

  • Mark Gius & Donn Johnson, 1998. "An empirical investigation of wage discrimination in professional basketball," Applied Economics Letters, Taylor & Francis Journals, vol. 5(11), pages 703-705.
    • Handle: RePEc:taf:apeclt:v:5:y:1998:i:11:p:703-705
    DOI: 10.1080/135048598354168
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    References listed on IDEAS

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    1. Eleanor Brown & Richard Spiro & Diane Keenan, 1991. "Wage and Nonwage Discrimination in Professional Basketball: Do Fans Affect It?," American Journal of Economics and Sociology, Wiley Blackwell, vol. 50(3), pages 333-345, July.
    2. Kahn, Lawrence M & Sherer, Peter D, 1988. "Racial Differences in Professional Basketball Players' Compensation," Journal of Labor Economics, University of Chicago Press, vol. 6(1), pages 40-61, January.
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    Cited by:

    1. David J. Berri & Rob Simmons, 2009. "Race and the Evaluation of Signal Callers in the National Football League," Journal of Sports Economics, , vol. 10(1), pages 23-43, February.
    2. Quinn Andrew Wesley Keefer, 2013. "Compensation Discrimination for Defensive Players," Journal of Sports Economics, , vol. 14(1), pages 23-44, February.
    3. James R. Hill & Nicholas A. Jolly, 2012. "Salary Distribution and Collective Bargaining Agreements: A Case Study of the NBA," Industrial Relations: A Journal of Economy and Society, Wiley Blackwell, vol. 51(2), pages 342-363, April.
    4. Candon Johnson & Eduardo Minuci, 2020. "Wage discrimination in the NBA: Evidence using free agent signings," Southern Economic Journal, John Wiley & Sons, vol. 87(2), pages 517-539, October.
    5. Erick Eschker & Stephen Perez & Mark Siegler, 2004. "The NBA and the influx of international basketball players," Applied Economics, Taylor & Francis Journals, vol. 36(10), pages 1009-1020.
    6. Liam J. A. Lenten, 2017. "Racial discrimination in umpire voting: an (arguably) unexpected result," Applied Economics, Taylor & Francis Journals, vol. 49(37), pages 3751-3757, August.
    7. Hisahiro Naito & Yu Takagi, 2017. "Is there A Positive Association between Increasing Salary Discrimination in the NBA and Unshrinking Racial Income Gap of White and Black Citizens ?," Tsukuba Economics Working Papers 2017-001, Faculty of Humanities and Social Sciences, University of Tsukuba.
    8. Richard C. K. Burdekin & Richard T. Hossfeld & Janet Kiholm Smith, 2005. "Are NBA Fans Becoming Indifferent to Race? Evidence From the 1990s," Journal of Sports Economics, , vol. 6(2), pages 144-159, May.
    9. Shao, Wen-Chao & Zhang, Han & Chou, Li-Chen & Ye, Xi-Xi, 2023. "Comparing athletes’ mastery of salary information before and during the COVID-19 pandemic: Evidence from the national basketball association," Economic Modelling, Elsevier, vol. 128(C).
    10. Leif Brandes & Marc Brechot & Egon Franck, 2011. "The Temptation of Social Ties: When Interpersonal Network Transactions Hurt Firm Performance," Working Papers 00159, University of Zurich, Institute for Strategy and Business Economics (ISU), revised 2012.
    11. David Berri & Stacey Brook & Aju Fenn, 2011. "From college to the pros: predicting the NBA amateur player draft," Journal of Productivity Analysis, Springer, vol. 35(1), pages 25-35, February.
    12. Hisahiro Naito & Yu Takagi, 2017. "Is racial salary discrimination disappearing in the NBA? evidence from data during 1985–2015," International Review of Applied Economics, Taylor & Francis Journals, vol. 31(5), pages 651-669, September.
    13. Chih-Hai Yang & Hsuan-Yu Lin, 2012. "Is There Salary Discrimination by Nationality in the NBA?," Journal of Sports Economics, , vol. 13(1), pages 53-75, February.
    14. Johnny Ducking & Peter A. Groothuis, 2023. "Positional Segregation and Career Length in Major League Baseball in the 1990s," Journal of Economics, Race, and Policy, Springer, vol. 6(3), pages 149-159, September.
    15. Lawrence M. Kahn, 2009. "The Economics of Discrimination: Evidence from Basketball," NCER Working Paper Series 40, National Centre for Econometric Research.
    16. Saumik Paul & Ronita Mitra, 2008. "How predictable are the FIFA worldcup football outcomes? An empirical analysis," Applied Economics Letters, Taylor & Francis Journals, vol. 15(15), pages 1171-1176.
    17. Pelnar, Gregory, 2007. "Antitrust Analysis of Sports Leagues," MPRA Paper 5382, University Library of Munich, Germany.
    18. Peter A. Groothuis & James Richard Hill, 2013. "Pay Discrimination, Exit Discrimination or Both? Another Look at an Old Issue Using NBA Data," Journal of Sports Economics, , vol. 14(2), pages 171-185, April.
    19. Christopher Jepsen, 2023. "Determinants of Career Exits and Career Breaks in Women's Professional Basketball," Journal of Sports Economics, , vol. 24(8), pages 1055-1075, December.
    20. Mark Gius & Donn Johnson, 2000. "Race and compensation in professional football," Applied Economics Letters, Taylor & Francis Journals, vol. 7(2), pages 73-75.
    21. Christian Deutscher & Oliver Gürtler & Joachim Prinz & Daniel Weimar, 2017. "The Payoff To Consistency In Performance," Economic Inquiry, Western Economic Association International, vol. 55(2), pages 1091-1103, April.

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