Journal article
The Dynamics of Performance Over the Duration of Major League Baseball Long-Term Contracts
Journal of sports economics, Vol.10(1), pp.6-22
02/01/2009
DOI: 10.1177/1527002508327382
Abstract
We re-examine incentives in Major League Baseball contracts by considering performance over the duration of the contract. We consider both the incentive to perform in order to maximize the subsequent contract and the disincentive of a fixed salary. We isolate the effect of the latter by controlling for the probability that the contract is the player's last. We find that players who are less likely to sign a subsequent contract have a large and statistically significant reduction in performance compared to expectations. The incentive to perform well in anticipation of signing the next contract is equally large and offsetting so that players who expect to sign another contract largely perform to expectations.
Details
- Title: Subtitle
- The Dynamics of Performance Over the Duration of Major League Baseball Long-Term Contracts
- Creators
- Anthony C. Krautmann - DePaul UniversityJohn L. Solow - University of Iowa
- Resource Type
- Journal article
- Publication Details
- Journal of sports economics, Vol.10(1), pp.6-22
- DOI
- 10.1177/1527002508327382
- ISSN
- 1527-0025
- eISSN
- 1552-7794
- Publisher
- Sage
- Number of pages
- 17
- Language
- English
- Date published
- 02/01/2009
- Academic Unit
- Economics
- Record Identifier
- 9984963057802771
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