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Returns to Education in Professional Football

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  • René Böheim
  • Mario Lackner

Abstract

After three years in the National Collegiate Athletic Association (NCAA), collegiate football players face a trade-off between spending more time in the NCAA and pursuing a career in the National Football League (NFL) by declaring for the draft. We analyze the starting salaries and signing bonuses for 1,673 rookies in the NFL, who entered the league between 2001 and 2009 through the NFL draft. We instrument the endogenous decision to enter the professional market with a player's month of birth. A player's true talent is only imperfectly observed and the instrument pro- vides a causal link between time at college and subsequent salaries in the NFL through the relative age effect. Our estimates suggest that a player enjoys a 6% higher starting salary in the NFL, and a 15% higher first-year signing bonus, for each year with the college team. On average, a rookie is estimated to earn $131,000 more in his rookie season, if he enters the NFL one year later. Our analysis of a typical labor market in professional sports shows that the returns to ed- ucation in sports are sizeable and surprisingly similar to returns to formal education. The results of our analysis provide information for the players who are deciding about declaring for the draft, however, also colleges and the teams in the NFL may find the results of interest.

Suggested Citation

  • René Böheim & Mario Lackner, 2011. "Returns to Education in Professional Football," Economics working papers 2011-02, Department of Economics, Johannes Kepler University Linz, Austria.
    • Handle: RePEc:jku:econwp:2011_02
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    File URL: http://www.econ.jku.at/papers/2011/wp1102.pdf
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    References listed on IDEAS

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    1. Returns to education in professional football
      by kevin denny in Kevin Denny: Economics more-or-less on 2011-05-16 01:36:46

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    Cited by:

    1. Luca Fumarco & Giambattista Rossi, 2015. "Relative Age Effect on Labor Market Outcomes for High Skilled Workers – Evidence from Soccer," Management Working Papers 9, Birkbeck Department of Management, revised Mar 2015.
    2. W. David Allen, 2015. "The Demand for Younger and Older Workers," Journal of Sports Economics, , vol. 16(2), pages 127-158, February.
    3. Martin Grossmann, 2021. "Asymmetric Opportunities After an Unsuccessful Sports Career," Journal of Sports Economics, , vol. 22(5), pages 587-612, June.
    4. Tukiainen, Janne & Takalo, Tuomas & Hulkkonen, Topi, 2019. "Relative age effects in political selection," European Journal of Political Economy, Elsevier, vol. 58(C), pages 50-63.
    5. repec:zbw:bofrdp:2018_015 is not listed on IDEAS
    6. Chassman, Stephanie & Littman, Danielle Maude & Bender, Kimberly & Santa Maria, Diane & Shelton, Jama & Ferguson, Kristin M. & Hsu, Hsun-Ta & Narendorf, Sarah C. & Barman-Adhikari, Anamika & Petering,, 2020. "Educational attainment among young adults experiencing homelessness in seven cities across the United States," Children and Youth Services Review, Elsevier, vol. 119(C).
    7. Fumarco, Luca & Gibbs, Benjamin & Jarvis, Jonathan & Rossi, Giambattista, 2016. "The Relative Age Effect Reversal among NHL Elite," MPRA Paper 75691, University Library of Munich, Germany.
    8. Luca Fumarco & Benjamin G Gibbs & Jonathan A Jarvis & Giambattista Rossi, 2017. "The relative age effect reversal among the National Hockey League elite," PLOS ONE, Public Library of Science, vol. 12(8), pages 1-16, August.
    9. Tukiainen, Janne & Takalo, Tuomas & Hulkkonen, Topi, 2019. "Relative age effects in political selection," European Journal of Political Economy, Elsevier, vol. 58(C), pages 50-63.
    10. Tukiainen, Janne & Takalo, Tuomas & Hulkkonen, Topi, 2017. "Gender Specific Relative Age Effects in Politics and Football," Working Papers 94, VATT Institute for Economic Research.
    11. Raluca Buhaș & Alexandru Ilieș & Sorana Săveanu & Paul Szabo-Alexi & Mariana Szabo-Alexi & Sorin Buhaș, 2023. "Socio-Professional Implications of Sports Events: A Perspective from Dual-Career Students," Sustainability, MDPI, vol. 15(10), pages 1-13, May.

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    More about this item

    Keywords

    NFL; returns to education; ability bias; labor markets in sports;
    All these keywords.

    JEL classification:

    • J31 - Labor and Demographic Economics - - Wages, Compensation, and Labor Costs - - - Wage Level and Structure; Wage Differentials

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