Are International Players Better? The Analysis of NBA Players’ Compensation and Efficiency

• Main Authors: Hsuan-yu Lin, 林軒宇
• Other Authors: Chih-hai Yang
• Format: Others
• Language: zh-TW
• Published: 2009
• Online Access: http://ndltd.ncl.edu.tw/handle/72535496960421414176

碩士 === 國立中央大學 === 經濟學研究所 === 97 === Over the past decade, NBA actively internationalize by substantially recruiting international players and creating overseas market. This thesis focuses on what the role personal characters play in determining players’ compensation, specifically in the cases that whether international players would enjoy higher premium than American players, and whether the market size in those international players’ countries would affect players’ compensation. Additionally, we discuss the issue of whether the increase in the international players is resulted from their superior performance compared with American players. In this way, we can examine whether international players’ efficiency is higher than American players. Based on 3747 observations selected from 939 players between 2000 and 2008, we employ Two-Stage Double Fixed-Effect Model to estimate the significant factors in determining NBA players’ compensation, further using DEA to analyze players’ efficiency. The empirical results suggest that characteristics do play a critical role in ruling their compensation. International players’ compensation is significantly lower than American players’. Additionally, the results of efficiency analysis indicate that no difference exists between international players and American players. International players seem to be cheap labors in NBA. Futhermore, market factor indeed determines international players’ compensation. This phenomenon is consistent with the commercial objectives NBA strives to achieve by recruiting international players. Besides, the results also indicate that other personal characters such as race, height, draft, and the market size of the city where the team is located play crucial roles in determining players’compensation.