Property Rights and Unilateral Player Transfers in a Multiconference Sports League
- 1 May 2002
- journal article
- Published by SAGE Publications in Journal of Sports Economics
- Vol. 3 (2), 122-132
- https://doi.org/10.1177/152700250200300202
Abstract
According to the invariance hypothesis, the allocation of players in sports leagues is the same, regardless of who owns their property rights. However, when a player moves to a new team, the absolute quality of the new team increases while the absolute quality of the former team decreases. This implies that intraconference teams will be willing to bid more for players than interconference teams. However, the asking price for player sales to intraconference teams will be higher than for interconference clubs. If clubs own player property rights, the intraconference effects are built into the ask/bid price. When players own property rights, however, the effect of the transfer on the former club’s revenue stream is ignored. This suggests that free agency should result in a higher percentage of intraconference player transfers than player sales. Player sale data from 1964-1975 and free agency data between 1976-1992 reveal evidence consistent with theory.Keywords
This publication has 12 references indexed in Scilit:
- Free Agency, Competitive Balance, and Diminishing Returns to Pennant ContentionEconomic Inquiry, 2001
- Free-Agency and the Competitiveness of Major League BaseballReview of Industrial Organization, 1999
- The Increasing Competitive Balance in Major League BaseballReview of Industrial Organization, 1997
- The Coase Theorem, Free Agency, and Major League Baseball: A Panel Study of Pitcher Mobility from 1961 to 1992Southern Economic Journal, 1996
- The impact of free agency on the distribution of playing talent in major league baseballJournal of Economics and Business, 1986
- MIGRATION TRENDS AND EARNINGS OF FREE AGENTS IN MAJOR LEAGUE BASEBALL, 1976–1979Economic Inquiry, 1983
- EXTERNALITIES, PROPERTY RIGHTS AND THE ALLOCATION OF RESOURCES IN MAJOR LEAGUE BASEBALLEconomic Inquiry, 1981
- An Economic Model of a Professional Sports LeagueJournal of Political Economy, 1971
- The Problem of Social CostThe Journal of Law and Economics, 1960
- The Baseball Players' Labor MarketJournal of Political Economy, 1956