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- Title
Baseball Salaries and Income Taxes: The “Home Field Advantage” of Income Taxes on Free Agent Salaries.
- Authors
Alm, James; Kaempfer, William H.; Sennoga, Edward Batte
- Abstract
In this article, the authors examine the impact on the salaries of free agents in Major League Baseball (MLB) of differences in state and local individual income taxes between major league cities, in an attempt to see if income taxes affect player salaries. This basic specification suggests that each percentage point of an income tax raises free agent salaries by $21,000 to $24,000; other estimates indicate even larger impacts. These findings suggest that the existence of this additional salary demand means that low-tax cities (e.g., Florida, Texas, and Washington) have a “home field advantage” in the baseball free agent market.
- Subjects
BASEBALL players; INCOME tax; FREE agents (Sports); MAJOR League Baseball (Organization); ECONOMIC demand; WAGES
- Publication
Journal of Sports Economics, 2012, Vol 13, Issue 6, p619
- ISSN
1527-0025
- Publication type
Article
- DOI
10.1177/1527002511422567