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Relative Salary Efficiency of Pga Tour Golfers

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  • Peter Nero

Abstract

Although a great deal of research has focused on Major League Baseball (MLB) players' salaries, there has been little attempt to derive a professional golfer's salary based upon tournament performance. MLB players' current salaries are a combination of two factors: past performances and predicted future performances. Professional golfers' earnings, however, are determined based upon how well each player performs in the tournaments entered throughout the course of a season. In other words, their earnings are a direct result of how efficiently a golfer can earn money given their statistical performance. This paper estimates golfers' earnings using four performance measures: putting average, driving distance, driving accuracy and the number of sand saves while controlling for the number of tournament starts. Using the estimated earnings equation, the relative performance of each golfer is calculated.

Suggested Citation

  • Peter Nero, 2001. "Relative Salary Efficiency of Pga Tour Golfers," The American Economist, Sage Publications, vol. 45(2), pages 51-56, October.
    • Handle: RePEc:sae:amerec:v:45:y:2001:i:2:p:51-56
    DOI: 10.1177/056943450104500206
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    References listed on IDEAS

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    1. Greene, William H., 1980. "Maximum likelihood estimation of econometric frontier functions," Journal of Econometrics, Elsevier, vol. 13(1), pages 27-56, May.
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    3. Ruggiero, John, 1999. "Efficiency estimation and error decomposition in the stochastic frontier model: A Monte Carlo analysis," European Journal of Operational Research, Elsevier, vol. 115(3), pages 555-563, June.
    4. Slottje, Daniel J. & Hirschberg, Joseph G. & Hayes, Kathy J. & Scully, Gerald W., 1994. "A new method for detecting individual and group labor market discrimination," Journal of Econometrics, Elsevier, vol. 61(1), pages 43-64, March.
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    Cited by:

    1. Scott J. Callan & Janet M. Thomas, 2007. "Modeling the Determinants of a Professional Golfer's Tournament Earnings," Journal of Sports Economics, , vol. 8(4), pages 394-411, August.
    2. Mark Broadie, 2012. "Assessing Golfer Performance on the PGA TOUR," Interfaces, INFORMS, vol. 42(2), pages 146-165, April.
    3. Stephen Shmanske, 2007. "Consistency or Heroics: Skewness, Performance, and Earnings on the PGA TOUR," Atlantic Economic Journal, Springer;International Atlantic Economic Society, vol. 35(4), pages 463-471, December.
    4. Ferdi Botha & Gavin Fraser & Thomas A. Rhoads, 2021. "Skill and Earnings Amongst Golfers on the Southern‐African Sunshine Tour," South African Journal of Economics, Economic Society of South Africa, vol. 89(2), pages 274-281, June.
    5. Stephen Shmanske, 2008. "Skills, Performance, and Earnings in the Tournament Compensation Model," Journal of Sports Economics, , vol. 9(6), pages 644-662, December.
    6. Ohn, Jonathan K. & Bealing, William & Waeger, Dan, 2012. "The Determinants of Annual Earnings for PGA Players Under the New PGA’s FedEx Cup System," Review of Applied Economics, Lincoln University, Department of Financial and Business Systems, vol. 8(1), pages 1-11, May.
    7. Thomas A. Rhoads, 2007. "Labor Supply on the PGA TOUR," Journal of Sports Economics, , vol. 8(1), pages 83-98, February.

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