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The Effects of Recessions and Market Sizes on NBA Player Salary

Some teams in the National Basketball Association experienced revenue declines during the Great Recession. Previous literature has found that teams in larger markets are able to generate more revenue due to higher populations. The recession left small-market teams suffering financially. I analyze a player based on his performance and examine if market size and recessions appreciate or depreciate a player’s salary. Further, I investigate if the competitive imbalance between big-market and small-market teams expanded due to the recession. My results suggest recessions do not have an impact on player salary, however player salary decreased by a small margin in post-recession years. The 2008 Great Recession did not enhance the competitive imbalance among teams. The NBA did an effective job accounting for decreasing team revenues during the recession and confirming all teams could spend amounts at or near the salary cap.
Date01 January 2017
CreatorsOwan, Lucas M
PublisherScholarship @ Claremont
Source SetsClaremont Colleges
Detected LanguageEnglish
SourceCMC Senior Theses
Rights© 2016 Lucas M. Owan, default

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