The effect of professional sports on the earnings of individuals: evidence from microeconomic data

Abstract

This article examines the impact of professional sports franchises in labour markets using data from the March Supplement to the Current Population Survey (CPS) for workers employed in specific occupational groups in all large US cities from 1983 to 2002. Results from a standard wage model suggest that professional football franchises increase average hourly and weekly earnings of males employed in these occupations, but professional baseball franchises reduce them. These results support growing evidence that professional sports affect labour markets. However, the mixed nature of the association between sport and earnings provides little economic justification for government subsidies for professional sport.

Notes

¹ See Coates (2007) for a recent survey of this large literature.

² See Topel (1986) and Murphy and Welch (1992) for examples of studies of the determinants of wages based on times series of cross-sections drawn from the CPS March Supplements.

³ Kesselring and Bremmer (2006) use a similar time series of CPS cross sections; Eschker et al. (2004) use data from the CPS March supplements in the context of professional sports.