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Uncertainty, Hiring, and Subsequent Performance: The NFL Draft

Author

Listed:
  • Wallace Hendricks

    (University of Illinois)

  • Lawrence DeBrock

    (University of Illinois)

  • Roger Koenker

    (University of Illinois)

Abstract

In this article, we analyze the impact of uncertainty on the hiring process. We show the connection between models of statistical discrimination where uncertainty can work against groups that have less reliable indicators of future productivity and models of option value where uncertainty about future productivity can be beneficial for these groups. These models generate hypotheses about the relationship between ex ante hiring patterns and ex post productivity. This is applied to the market for NFL football players. We provide various estimates of NFL success, which suggest that statistical discrimination and option value influence choices in this market.

Suggested Citation

  • Wallace Hendricks & Lawrence DeBrock & Roger Koenker, 2003. "Uncertainty, Hiring, and Subsequent Performance: The NFL Draft," Journal of Labor Economics, University of Chicago Press, vol. 21(4), pages 857-886, October.
    • Handle: RePEc:ucp:jlabec:v:21:y:2003:i:4:p:857-886
    DOI: 10.1086/377025
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    References listed on IDEAS

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