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Do Major League Baseball Hitters Engage in Opportunistic Behavior?

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  • Heather O’Neill

Abstract

This study focuses on 256 Major League Baseball free agent hitters playing under the 2006–2011 collective bargaining agreement to determine whether players engage in opportunistic behavior in their contract year, i.e., the last year of their current guaranteed contracts. Past studies of professional baseball yield conflicting results depending on the econometric technique applied and choice of performance measure. When testing whether players’ offensive performances increase during their contract year, the omitted variable bias associated with OLS and pooled OLS estimation leads to contrary results compared to fixed effects modeling. Fixed effects regression results suggest players increase their offensive performance subject to controlling for the intention to retire. Copyright International Atlantic Economic Society 2013

Suggested Citation

  • Heather O’Neill, 2013. "Do Major League Baseball Hitters Engage in Opportunistic Behavior?," International Advances in Economic Research, Springer;International Atlantic Economic Society, vol. 19(3), pages 215-232, August.
    • Handle: RePEc:kap:iaecre:v:19:y:2013:i:3:p:215-232:10.1007/s11294-013-9419-y
    DOI: 10.1007/s11294-013-9419-y
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    References listed on IDEAS

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    1. Anthony C. Krautmann & Margaret Oppenheimer, 2002. "Contract Length and the Return to Performance in Major League Baseball," Journal of Sports Economics, , vol. 3(1), pages 6-17, February.
    2. Anthony C. Krautmann & John L. Solow, 2009. "The Dynamics of Performance Over the Duration of Major League Baseball Long-Term Contracts," Journal of Sports Economics, , vol. 10(1), pages 6-22, February.
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    4. Evan C. Holden & Paul M. Sommers, 2005. "The Influence of Free-Agent Filing on MLB Player Performance," Middlebury College Working Paper Series 0507, Middlebury College, Department of Economics.
    5. Kahn, Lawrence M, 1993. "Free Agency, Long-Term Contracts and Compensation in Major League Baseball: Estimates from Panel Data," The Review of Economics and Statistics, MIT Press, vol. 75(1), pages 157-164, February.
    6. Evan Holden & Paul Sommers, 2005. "The Influence of Free-Agent Filing on MLB Player Performance," Atlantic Economic Journal, Springer;International Atlantic Economic Society, vol. 33(4), pages 489-490, December.
    7. Joel G. Maxcy & Rodney D. Fort & Anthony C. Krautmann, 2002. "The Effectiveness of Incentive Mechanisms in Major League Baseball," Journal of Sports Economics, , vol. 3(3), pages 246-255, August.
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    More about this item

    Keywords

    Sports economics; Free agency; Opportunistic behavior; Contract year; Guaranteed contracts; J31; J44;
    All these keywords.

    JEL classification:

    • J31 - Labor and Demographic Economics - - Wages, Compensation, and Labor Costs - - - Wage Level and Structure; Wage Differentials
    • J44 - Labor and Demographic Economics - - Particular Labor Markets - - - Professional Labor Markets and Occupations

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