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The NBA, Exit Discrimination, and Career Earnings

Author

Listed:
  • Hoang, Ha
  • Rascher, Dan

Abstract

The purpose of this paper is threefold. First, it complements the many wage discrimination studies by examining exit discrimination in the NBA using a decade's worth of data (the 1980's). White players have a 36% lower risk of being cut than black players, ceteris paribus, translating into an expected career length of 7.5 seasons for an apparently similar player who is white, and 5.5 seasons for the same player who is black. Second, the career earnings effect of exit discrimination in the 1980's is larger ($808,000) than the career earnings effect of wage discrimination ($329,000). Third, our data are consistent with the hypothesis that customer racial discrimination is the reason for the observed exit discrimination.

Suggested Citation

  • Hoang, Ha & Rascher, Dan, 1999. "The NBA, Exit Discrimination, and Career Earnings," MPRA Paper 3542, University Library of Munich, Germany.
  • Handle: RePEc:pra:mprapa:3542
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    File URL: https://mpra.ub.uni-muenchen.de/3542/1/MPRA_paper_3542.pdf
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    References listed on IDEAS

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    1. Kahn, Lawrence M, 1991. "Customer Discrimination and Affirmative Action," Economic Inquiry, Western Economic Association International, vol. 29(3), pages 555-571, July.
    2. William D. Walsh, 1992. "The Entry Problem of Francophones in the National Hockey League: A Systemic Interpretation," Canadian Public Policy, University of Toronto Press, vol. 18(4), pages 443-460, December.
    3. Becker, Gary S., 1971. "The Economics of Discrimination," University of Chicago Press Economics Books, University of Chicago Press, edition 2, number 9780226041162, September.
    4. J. C. H. Jones & William D. Walsh, 1988. "Salary Determination in the National Hockey League: The Effects of Skills, Franchise Characteristics, and Discrimination," ILR Review, Cornell University, ILR School, vol. 41(4), pages 592-604, July.
    5. 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.
    6. Rodney Fort & James Quirk, 1995. "Cross-subsidization, Incentives, and Outcomes in Professional Team Sports Leagues," Journal of Economic Literature, American Economic Association, vol. 33(3), pages 1265-1299, September.
    7. Diebold, Francis X & Neumark, David & Polsky, Daniel, 1997. "Job Stability in the United States," Journal of Labor Economics, University of Chicago Press, vol. 15(2), pages 206-233, April.
    8. Lawrence M. Kahn, 1991. "Discrimination in Professional Sports: A Survey of the Literature," ILR Review, Cornell University, ILR School, vol. 44(3), pages 395-418, April.
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    Citations

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    Cited by:

    1. yamamura, eiji, 2008. "Game Information, Local Heroes, And Their Effect On Attendance: The Case Of The Japanese Baseball League," MPRA Paper 10303, University Library of Munich, Germany.
    2. Lawrence M. Kahn, 2009. "The Economics of Discrimination: Evidence from Basketball," NCER Working Paper Series 40, National Centre for Econometric Research.
    3. Dilger, Alexander, 2002. "Never change a winning team: An analysis of hazard rates in the NBA," Wirtschaftswissenschaftliche Diskussionspapiere 03/2002, University of Greifswald, Faculty of Law and Economics.
    4. Igan, Deniz & Pinheiro, Marcelo & Smith, John, 2015. "A study of a market anomaly: “White Men Can’t Jump”, but would you bet on it?," Journal of Economic Behavior & Organization, Elsevier, vol. 113(C), pages 13-25.
    5. Grund, Christian & Höcker, Jan & Zimmermann, Stefan, 2010. "Risk Taking Behavior in Tournaments: Evidence from the NBA," IZA Discussion Papers 4812, Institute for the Study of Labor (IZA).
    6. 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.
    7. Scott Tainsky & Brian M. Mills & Jason A. Winfree, 2015. "Further Examination of Potential Discrimination Among MLB Umpires," Journal of Sports Economics, , vol. 16(4), pages 353-374, May.
    8. Johnny Ducking & Peter A. Groothuis & James Richard Hill, 2014. "Minimum Pay Scale and Career Length in the NBA," Industrial Relations: A Journal of Economy and Society, Wiley Blackwell, vol. 53(4), pages 617-635, October.
    9. 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.
    10. 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.
    11. Boyden Nathaniel B & Carey James R, 2010. "From One-and-Done to Seasoned Veterans: A Demographic Analysis of Individual Career Length in Major League Soccer," Journal of Quantitative Analysis in Sports, De Gruyter, vol. 6(4), pages 1-17, October.
    12. Peter A. Groothuis & James Richard Hill, 2015. "Exit Discrimination in the NBA. Is there a Bias against Foreigners?," Working Papers 15-10, Department of Economics, Appalachian State University, revised 2015.
    13. Lawrence M. Kahn, 2000. "The Sports Business as a Labor Market Laboratory," Journal of Economic Perspectives, American Economic Association, vol. 14(3), pages 75-94, Summer.
    14. Eiji Yamamura, 2011. "Game Information, Local Heroes, and Their Effect on Attendance: The Case of the Japanese Baseball League," Journal of Sports Economics, , vol. 12(1), pages 20-35, February.
    15. Scott Tainsky & Jason A. Winfree, 2010. "Discrimination and Demand: The Effect of International Players on Attendance in Major League Baseball," Social Science Quarterly, Southwestern Social Science Association, vol. 91(1), pages 117-128.
    16. Craig A. Depken & Johnny Ducking & Peter A. Groothuis, 2017. "Career duration in the NHL: pushing and pulling on Europeans?," Applied Economics, Taylor & Francis Journals, vol. 49(59), pages 5923-5934, December.
    17. McDonald, Mark & Rascher, Daniel, 2000. "Does Bat Day Make Cents? The Effect of Promotions on the Demand for Major League Baseball," MPRA Paper 25739, University Library of Munich, Germany.
    18. Berri, David J. & Schmidt, Martin B., 2002. "Instrumental versus bounded rationality: a comparison of Major League Baseball and the National Basketball Association," Journal of Behavioral and Experimental Economics (formerly The Journal of Socio-Economics), Elsevier, vol. 31(3), pages 191-214.
    19. Jeffrey Chu & Saralees Nadarajah & Emmanuel Afuecheta & Stephen Chan & Ying Xu, 2014. "A statistical study of racism in English football," Quality & Quantity: International Journal of Methodology, Springer, vol. 48(5), pages 2915-2937, September.

    More about this item

    Keywords

    discrimination; labor economics; career earnings; basketball; survival analysis;

    JEL classification:

    • J31 - Labor and Demographic Economics - - Wages, Compensation, and Labor Costs - - - Wage Level and Structure; Wage Differentials
    • J71 - Labor and Demographic Economics - - Labor Discrimination - - - Hiring and Firing

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