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- Title
Major League Baseball Salaries: The Impacts of Arbitration and Free Agency.
- Authors
Hadley, Lawrence; Gustafson, Elizabeth
- Abstract
Earnings equations are estimated for major league baseball hitters and pitchers using salary data for the 1989 season. The results indicate that final- offer salary arbitration and long-term contracts have a large positive impact on salaries. The impact of free-agency eligibility is also positive, but smaller than arbitration eligibility. This implies that some players have used the arbitration process to extract above-market salaries. Therefore it is concluded that it would be in the interest of the owners to replace arbitration with earlier eligibility for free agency.
- Subjects
BASEBALL players; INCOME; WAGES; SPORTS; INCOME inequality; EARNED income
- Publication
Journal of Sport Management, 1991, Vol 5, Issue 2, p111
- ISSN
0888-4773
- Publication type
Article
- DOI
10.1123/jsm.5.2.111