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What is a Blue Chip Recruit Worth? Estimating the Marginal Revenue Product of College Football Quarterbacks

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  • Peter K. Hunsberger
  • Seth R. Gitter

Abstract

The National Collegiate Athletic Association has faced growing scrutiny due to the perceived disparity between the compensation athletes receive and their contribution to athletic revenue. Our novel use of college football game–level statistics shows a gap of millions of dollars between compensation and marginal revenue product (MRP) for elite quarterbacks, consistent with previous studies. Professional sports typically weight pay toward ex ante expected value of performance rather than incentives that pay ex post of performance. Using high school prospect rankings, we show ex ante estimates of elite quarterback expected MRP are substantially lower, roughly US$400,000, and have limited statistical significance with respect to winning or revenue. Our ex ante measurements suggest that expected player value may be closer to the value of scholarships than previous research suggests due to the difficulty in predicting which high school quarterbacks will excel in college.

Suggested Citation

  • Peter K. Hunsberger & Seth R. Gitter, 2015. "What is a Blue Chip Recruit Worth? Estimating the Marginal Revenue Product of College Football Quarterbacks," Journal of Sports Economics, , vol. 16(6), pages 664-690, August.
    • Handle: RePEc:sae:jospec:v:16:y:2015:i:6:p:664-690
    DOI: 10.1177/1527002515580938
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    References listed on IDEAS

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    1. Erin Lane & Juan Nagel & Janet S. Netz, 2014. "Alternative Approaches to Measuring MRP," Journal of Sports Economics, , vol. 15(3), pages 237-262, June.
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    Cited by:

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    5. Roger D. Blair & Wenche Wang, 2018. "The NCAA Cartel and Antitrust Policy," Review of Industrial Organization, Springer;The Industrial Organization Society, vol. 52(2), pages 351-368, March.

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    More about this item

    Keywords

    college football; college sports revenue; quarterback;
    All these keywords.

    JEL classification:

    • L83 - Industrial Organization - - Industry Studies: Services - - - Sports; Gambling; Restaurants; Recreation; Tourism
    • J30 - Labor and Demographic Economics - - Wages, Compensation, and Labor Costs - - - General

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