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Minimum Pay Scale and Career Length in the NBA

Author

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  • Johnny Ducking
  • Peter A. Groothuis
  • James Richard Hill

Abstract

We use data from the National Basketball Association (NBA) to analyze the impact of minimum salaries on an employee’s career length. The NBA has a salary structure in which the minimum salary a player can receive increases with the player’s years of experience. Salary schedules similar to the NBA’s exist in public education, federal government agencies, the Episcopalian church, and unionized industries. Even though the magnitude of the salaries in the NBA differs from other industries, this study provides insight to the impact of this type of salary structure on career length. Using duration analysis, we find statistically significant evidence that minimum salaries shorten career length. Key Words:

Suggested Citation

  • Johnny Ducking & Peter A. Groothuis & James Richard Hill, 2012. "Minimum Pay Scale and Career Length in the NBA," Working Papers 12-02, Department of Economics, Appalachian State University.
  • Handle: RePEc:apl:wpaper:12-02
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    File URL: http://econ.appstate.edu/RePEc/pdf/wp1202.pdf
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    References listed on IDEAS

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    1. Mark C. Berger & Dan A. Black, 1998. "The Duration Of Medicaid Spells: An Analysis Using Flow And Stock Samples," The Review of Economics and Statistics, MIT Press, vol. 80(4), pages 667-675, November.
    2. Johnny Ducking & Peter Groothuis & James Hill, 2015. "Exit Discrimination in the NFL: A Duration Analysis of Career Length," The Review of Black Political Economy, Springer;National Economic Association, vol. 42(3), pages 285-299, September.
    3. Hoang, Ha & Rascher, Dan, 1999. "The NBA, Exit Discrimination, and Career Earnings," MPRA Paper 3542, University Library of Munich, Germany.
    4. Peter A. Groothuis & James Richard Hill, 2008. "Exit Discrimination in Major League Baseball: 1990–2004," Southern Economic Journal, Southern Economic Association, vol. 75(2), pages 574-590, October.
    5. William A. Hamlen Jr., 2007. "Deviations From Equity and Parity in the National Football League," Journal of Sports Economics, , vol. 8(6), pages 596-615, December.
    6. Johnny Ducking & Peter Groothuis & James Hill, 2015. "Exit Discrimination in the NFL: A Duration Analysis of Career Length," The Review of Black Political Economy, Springer;National Economic Association, vol. 42(3), pages 285-299, September.
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    Cited by:

    1. Kelly M. Hastings & Frank Stephenson, 2015. "The NBA’s Maximum Player Salary and the Distribution of Player Rents," International Journal of Financial Studies, MDPI, Open Access Journal, vol. 3(2), pages 1-9, March.

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