Arbitrator bias and self-interest: Lessons from the baseball labor market

Their desire for enduring employment is commonly assumed to induce arbitrators to make fair awards. We find, however, that in major league baseball's unique institutional setting, selfinterested behavior by arbitrators has led to bias against players and preservation of monopsony rents for team owners. We apply a standard model of arbitrator behavior to all 391 arbitrated cases in baseball since 1979. Under conditions that should lead to an even split in awards to teams and players, probit analysis indicates that arbitrators favor teams 61 percent of the time. Furthermore, bias against African-American and Latinborn players is even more pronounced.     

Baseball's emotion work: Getting psyched to play

The problematic nature of sport contests creates a variety of emotions—anxiety, fear, sadness, joy, anger, disgust, frustration, compassion, and embarrassment. The present study uses an interactionist/interpretive investigation of baseball hitters and pitchers (N=21). Data were gathered by analysis of in-depth semistructured interviews with members of a college baseball team. A photo-elicitation interviewing technique was used with videotapes of the players in game situations. Players were asked to respond to the experience of hitting and pitching while observing the videotapes of themselves. The emotional experiences that emerged from the interviews focused on managing and maintaining their emotions within an optimal level of arousal. The players perceive the optimal level of arousal is necessary for a desirable performance.     

Marginal revenue and labor strife in major league baseball

An improved model of baseball player performance and revenue generation shows that, overall, major league players are paid more than the marginal revenue they generate from spectators at the ballpark. Broadcast revenue is shown to be a factor in player salaries, although this revenue is not sensitive to individual player output. Under the current bargaining procedure, collective action in baseball is therefore viewed as the only way to entice owners to pay players for the broadcast revenue they generate.     

Firm-specific human capital, job matching, and turnover: evidence from major league baseball, 1900–1992

The two dominant labor market turnover hypotheses, the firm-specific human capital model (FSHCM) and the job-matching model, suggest different patterns of player mobility in major league baseball. The matching hypothesis predicts greater mobility of players in positions that require substantial team production. A better match may offer large productivity gains. Alternately, the FSHCM predicts players in positions requiring the greatest amount of teamwork will benefit from specific knowledge, making them less likely to change teams. We examine the frequency distribution of trades by player position from 1900–1992 and find the FSHCM provides the best explanation for turnover in this industry.     

Predicting outcomes: Sports and stocks

Many gamblers and most fans, players, and coaches offer causal explanations for long runs of good or bad performance in sports and financial analysts are quick to offer explanations for the daily performance of the stock market. The records of professional basketball and baseball teams and the Dow Jones daily closing average for a ten year period were evaluated for trends (streaks). The records of teams were also evaluated to assess whether the record against opponents, the home court or home field advantage, and—for baseball teams—the record of the winning and losing pitcher (excluding the current game) predicted the outcome of individual games. Recent performance is, at best, a very weak predictor of current performance and the three best predictors for baseball (pitching, home field, and record against opponent) together accounted for only 1.7% of the variance in the outcomes of individual games. We overestimate our ability to predict. This overconfidence is likely to play a role in maintaining gambling behaviors.     

Traveling With the Ball Club: A Code of Conduct for Wives Only

When they accompany their husbands on road trips, the wives of major league baseball players must follow an unwritten code of conduct, a code socially constructed and enforced by men. This code is reflected in the way wives and ballplayers interact on airplanes and buses, and most strikingly, in the requirement that wives stay out of hotel bars where the team is staying. These interactions within a code reflecting female conformity to male dominance, and preserving male privileges, provide a lens through which we can inspect gender inequity and marital inequity, including what can fairly be called institutionalized adultery. We always talk about the unwritten rule book of being a baseball wife. We have our own rules. There's these unwritten rules that you do and you don't do. That's why everybody thinks that every wife should have to go into the minor league system, and not straight into the big leagues. —Marsha     

Free agents’ impact on the labor market for baseball players

This paper evaluates the 1976 free agent rule’s impact on the labor market for baseball players. Free agency has specific consequences for monopsonistic exploitation and racial discrimination in salary determination. It reduces monopsonistic exploitation for all players and increases salary opportunities for black and Latino players. However, this change in a player’s status vis-à-vis a team has generated salary disparities among players based, not on race, but bargaining position. I would like to thank Linda Kammann, Mary O’Brien, and Benjamin Preston for their research assistance. Also I wish to thank John Siegfried and an anonymous referee for their comments. I remain solely responsible for the contents of this paper.     

VOTING BEHAVIOR, DISCRIMINATION AND THE NATIONAL BASEBALL HALL OF FAME

We investigate whether black, Latin, and white major league baseball players receive the same consideration by the Baseball Writers' Association of America in voting for membership into The National Baseball Hall of Fame. The first stage of Heckman's two-step procedure indicates that the probability a black player will ever receive at least one vote is significantly lower than that for his white counterpart. The second stage suggests that race or ethnicity sometimes matter in determining the number of votes a candidate receives for Hall of Fame membership. (JEL J7, D72)     

CUSTOMER RACIAL DISCRIMINATION IN MAJOR LEAGUE BASEBALL

Most studies of racial discrimination concentrate on identifying the existence rather than the source of discrimination. In contrast, this paper tests directly for racial discrimination by major league baseball customers by examining the market for baseball cards. In Tobit regressions, the market prices of cards consistently reflect player performance records and other demand variables. When interactive race-productivity variables are included in the models, a significant and complex pattern of fan discrimination against black pitchers and black hitters is found. Discrimination against latin players is not found.     

Continuity and change in the regional stereotypes of southern college students, 1970–1987

This article examines the effects of the race and Hall of Fame membership of professional football players on the value of their “rookie” football cards. Several studies have examined the impact of race on the value of baseball cards, but only one paper has examined this topic among football card collectors. Data were derived from 177 black and white football players who are members of the NFL Hall of Fame or who have been on the final voting ballot for the Hall. All of the players in the sample started their careers after professional football became racially integrated. Data for each player's race, value of their rookie card, card availability (scarcity), performance, Hall membership, and position were obtained from secondary sources. The principle finding of the study is that when controlling for factors such as position, performance, and card scarcity, race applies an independent effect on the value of the rookie cards of NFL Hall of Fame members, but not among non-Hall of Fame cards. Speculation on why “race matters” and suggestions for future research are offered.     

Free agency,owner incentives,and the national football league players association

In an effort to raise salaries in professional football, the National Football League Players Association (NFLPA) has demanded that NFL owners set aside 55 percent of gross revenues to fund a union wage scale. An alternative means of raising salaries, as evidenced by the relatively higher earnings in major league baseball and professional basketball, is through a free agent system wherein players are free to sell themselves in the open market. This paper examines the NFLPA’s claim that free agency will not work in the NFL because owners lack the financial incentive to win that would induce them to bid on free agents.     

EXTERNALITIES, PROPERTY RIGHTS AND THE ALLOCATION OF RESOURCES IN MAJOR LEAGUE BASEBALL

Most economists who have analyzed professional baseball have concluded that two distinctive features of its labor market—the reserve clause and player draft—influence the distribution of wealth between players and owners but do not affect the allocation of playing talent among teams. Such conclusions, which are strongly at variance with laymen's views of such matters, are derived from theoretical considerations rather than empirical examinations. Our paper examines data from the two decades of major league history and concludes that, on the basis of that data, the empirical generalizations of previous economists do not appear to be justified.     

Consumer racial discrimination: A reassessment of the market for baseball cards

Research on the presence of consumer racial discrimination in the baseball labor and memorabilia markets has produced contradictory empirical results. While studies of baseball salaries find no evidence of discrimination, Nardinelli and Simon (1990) and Andersen and La Croix (1991) use data from the baseball card market to show that the price that consumers pay for a card depends on the player’s race. In this paper, we reconsider the evidence of consumer discrimination in the baseball card market. Our study improves on previous research by applying more appropriate econometric methods and using a data set in which card supply is constant and incentives for speculative demand are weaker. In contradiction to the aforementioned studies, we find little evidence of racial discrimination. This result proves robust across variable specifications and econometric models. The authors thank Tyler Cowen, Kevin Grier, David Levy, Barb McKiernan, Don Palmer, Dan Sutler, and Bob Tollison for helpful suggestions on an earlier draft.     

Personal predictors of spectator aggression at little league baseball games

Parents from two baseball leagues completed questionnaires regarding their likelihood of engaging in various aggressive behaviors (yelling, swearing, shoving, fighting, humiliating) toward targets at youth baseball games (other spectators, umpires, coaches, other players, their child). Overall, the likelihood of all forms of aggression was very low, particularly physical aggression and swearing. Hierarchical entry stepwise regressions were calculated to determine predictors of yelling and humiliating using demographics, trait aggression, anger, hostility, and vengeance as predictors. Parents with greater hostility reported a greater likelihood of humiliating a child's teammate, while those with elevated trait anger reported a greater likelihood of yelling at other spectators. Finally, parents with a more vengeful attitude reported a greater likelihood of humiliating umpires.     

Involvement in Family,Religion, Education,Work, and Politics

Abstract

This paper explores the relationships among five spheres of individual involvement: family, religion, education, work, and politics. A theoretical framework stressing the extent of structural differentiation in modern societies led to the hypothesis that the spheres of involvement would be quite independent. Within the context of differentiation, it was hypothesized that the spheres of education, work, and politics on the one hand and family and religion on the other would be most highly related. Data from a national sample of retired professional baseball players allowed examination of these hypotheses for three age cohorts (30–49; 50–69; 70 and over) and three life cycle stages (early in the respondents' playing careers, late in their careers, and at present). The data generally supported for the hypotheses, but also suggested some important extensions of the theory. The implications for future theory and research on involvement are discussed.     

DOES OPTION THEORY HOLD FOR MAJOR LEAGUE BASEBALL CONTRACTS?

We test whether option theory indicated by the Black–Scholes formula is consistent with contract negotiations between teams and players in Major League Baseball (MLB). Teams use contract options in order to obtain the right to buy a player's services for an extra year when negotiating multiple year contracts. These options are similar to European call options, and should reduce the risk of buying volatile assets (players with high variation in performance). In this paper, we model the decision to buy an option (include an option year in the contract) and whether to exercise the option (pay the option salary in the option year versus buying out the option). The results indicate that the behavior of MLB teams is consistent with standard option theory both in terms of buying and exercising options. The sample is the complete population of free agent hitters who signed new contracts between the years 2003 and 2011. We were unable to find any published literature that has addressed this issue. (JEL ZO, H3)     

Investigating customer racial discrimination in the secondary baseball card market

A growing body of literature in a variety of disciplines has appeared over the last 20 years examining customer racial bias in the secondary sports card market; however, consensus on the matter has yet to emerge. In this article, we explore the more subtle ways that a player's race/ethnicity may affect the value of his sports card including a player's skin tone (light- to dark-skinned). Data were obtained for 383 black, Latino, and white baseball players who had received at least one vote for induction into Major League Baseball's Hall of Fame including their career performance statistics, rookie card price, card availability, Hall of Fame status, and skin tone. Findings indicate that card availability is the primary determinant of card value while a player's skin tone has no direct effect. Subsequent analysis demonstrates that a player's race (white/non-white) rather than skin tone did have an effect as it interacts with Hall of Fame status to influence his rookie card price.     

Police bargaining,arbitration, and fringe benefits

Data from a national sample of 500 to 600 U.S. cities with over 25,000 in population indicated that the practice of police collective bargaining has a positive, strong association with fringe benefits (measured by city contributions for police retirement and insurance benefits per police officer). The availability of arbitration, however, seems to have little or no influence on the dollar amount of police fringes, and neither the current nor the prior use of arbitration (i.e., actually receiving an arbitration award) has any consistent association with police fringes. The results indicate that collective bargaining and regional location influence the level of police fringes more than do other variables. We are grateful to Steve Kawakami, Mark Phillips, Joe Schimansky, and Dick Williams for some excellent research assistance. We are also grateful to the National Institute of Justice of the U.S. Department of Justice for financially supporting this research. Such support does not mean that the Institute or Department necessarily agrees with our methods or conclusions.     

USING BASEBALL CARD PRICES TO MEASURE STAR QUALITY AND MONOPSONY

Baseball card prices are used to capture star quality in a new measure of productivity in Major League Baseball. Star quality, which impacts revenues, is determined from a player's baseball card price as the residual in a fit of card prices to performance statistics. This measure is entered into the computation of individual player marginal revenue product and compared to players' salaries using data from the four years leading up to the 1994 MLB strike. Results are examined for monopsonistic exploitation by market size, free agency status, type of player, and other relevant categories. Underpaid and overpaid players are identified.