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Empirical Test of a Separating Equilibrium in National Football League Contract Negotiations

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  • Mike Conlin

Abstract

I empirically test for a separating equilibrium in the bargaining contract of National Football League (NFL) contract negotiations. The separating equilibrium predicts that a player who delays contractual agreement signs a more lucrative contract and has positive private information on his ability level at the time of contract negotiations. These predictions are tested using data on 1,873 players selected in the 1986 through 1991 NFL drafts. The empirical results support the implications of the separating equilibrium.

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  • Mike Conlin, 1999. "Empirical Test of a Separating Equilibrium in National Football League Contract Negotiations," RAND Journal of Economics, The RAND Corporation, vol. 30(2), pages 289-304, Summer.
    • Handle: RePEc:rje:randje:v:30:y:1999:i:summer:p:289-304
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    References listed on IDEAS

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    1. David Card, 1990. "Strikes and Wages: A Test of an Asymmetric Information Model," The Quarterly Journal of Economics, President and Fellows of Harvard College, vol. 105(3), pages 625-659.
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    Cited by:

    1. Jesse Bricker & Andrew Hanson, 2013. "The Impact of Early Commitment on Games Played: Evidence from College Football Recruiting," Southern Economic Journal, John Wiley & Sons, vol. 79(4), pages 971-983, April.
    2. Borghesi, Richard, 2008. "Allocation of scarce resources: Insight from the NFL salary cap," Journal of Economics and Business, Elsevier, vol. 60(6), pages 536-550.
    3. Lynne G. Zucker & Michael R. Darby & Maximo Torero, 2002. "Labor Mobility from Academe to Commerce," Journal of Labor Economics, University of Chicago Press, vol. 20(3), pages 629-660, July.
    4. Michael Conlin & Patrick M. Emerson, 2006. "Discrimination in Hiring Versus Retention and Promotion: An Empirical Analysis of Within-Firm Treatment of Players in the NFL," The Journal of Law, Economics, and Organization, Oxford University Press, vol. 22(1), pages 115-136, April.
    5. Michael Conlin & Patrick M. Emerson, 2003. "Multidimensional Separating Equilibria and Moral Hazard: An Empirical Study of National Football League Contract Negotiations," The Review of Economics and Statistics, MIT Press, vol. 85(3), pages 760-765, August.
    6. Farmer, Amy & Pecorino, Paul & Stango, Victor, 2004. "The Causes of Bargaining Failure: Evidence from Major League Baseball," Journal of Law and Economics, University of Chicago Press, vol. 47(2), pages 543-568, October.
    7. Deutscher, Christian & Gürtler, Marc & Gürtler, Oliver & DeVaro, Jed, 2020. "Firm choice and career success - theory and evidence," European Economic Review, Elsevier, vol. 127(C).
    8. Conlin, Michael & Orsini, Joe & Tang, Meng-Chi, 2013. "The effect of an agent’s expertise on National Football League contract structure," Economics Letters, Elsevier, vol. 121(2), pages 275-281.
    9. Furmaco, L. & Longley, N. & Palermo, A. & Rossi, G., 2021. "Employees’ Performance Variation over Fixed-Term Contracts - Evidence from the National Hockey League," Working Papers 2107, Tulane University, Department of Economics.

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