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The National Football League payroll cost function and labor market institutional changes

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  • Stacey L. Brook

Abstract

Sports club payroll costs typically comprise over 50% of sport clubs' total operating expenses, but little is known empirically about this largest component of club costs. Using data from the National Football League Players Association Salary Cap Information System from 1981 to 2000, a National Football League club payroll cost function is estimated to examine the impact of labor market institutional changes (strikes and collective bargaining) and to test existing theoretical sports club cost functions. As expected, strikes have a negative effect on total payroll, and the two collective bargaining agreements had opposite effects during this time period. Additionally, empirical support is provided for the standard two‐team sport league cost function.

Suggested Citation

  • Stacey L. Brook, 2019. "The National Football League payroll cost function and labor market institutional changes," Managerial and Decision Economics, John Wiley & Sons, Ltd., vol. 40(8), pages 1016-1022, December.
    • Handle: RePEc:wly:mgtdec:v:40:y:2019:i:8:p:1016-1022
    DOI: 10.1002/mde.3087
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    Cited by:

    1. Thieme, Lutz & Falk, Rüdiger, 2021. "Zur Entwicklung von Vergütungssystemen in deutschen Großsportvereinen," Working Papers of the European Institute for Socioeconomics 35, European Institute for Socioeconomics (EIS), Saarbrücken.

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