Teammate effects on pay

Abstract

This paper explores the question of whether a worker's pay is affected by the attributes of co-workers. Using data from the NBA on players who have switched teams, it is found that teammate attributes do influence an individual's pay. Comparisons to the NHL suggest that differential co-worker effects reflect the nature of complementarity in different production environments.

Acknowledgements

We would like to thank Larry Kahn and Gerard Scully for helpful comments. We also thank Barton Hamilton for sharing his NBA data with us. All standard caveats apply.

Notes

The limiting case of withdrawal of effort would be a worker deciding to change employers, or in our case to change teams, thereby fully withholding the positive externalities provided to teammates' output.

Rookies are excluded since they are untested in the NBA and their salaries may be, in part, determined by different criterion (such as college performance).

Summary statistics for all variables are available on request.