Abstract
As with all collegiate sports in the United States, athletes do not earn income from their labor efforts. This is due, primarily, to the structure of the NCAA as an incidental cartel. This cartel market power translates to price ceilings on wages and quotas on the number of athletes employed. On average, most college swimmers are generating at least the value of their athletic scholarship. However, some generate far more. This lays the groundwork for future work on exploitation of student-athletes and estimation of the deadweight welfare loss in aquatic sport.
They’re not professional athletes. They’re not what some people are arguing they should become, which is unionized employees of the university.
—Mark Emmert, NCAA President talking about college basketball players
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Notes
- 1.
This estimated coefficient is not statistically significant. As discussed in Chap. 6, many colleges do not report revenues for swimming and diving separately. And, most of the Olympic swimmers come from just a handful of NCAA DI schools. This limits the sample size and contributes to large standard errors.
- 2.
Exploitation is defined in the sense that Joan Robinson introduced. When a laborer earns less than her marginal revenue product, she is exploited.
- 3.
Major League Baseball labor earns 53%, National Football League Labor earns 52%, and the English Premier League earns 76%. Zimbalist (2010) estimated the NFL earns 60% of revenues.
- 4.
The fact that most Olympic swimmers make far less than this because of their amateur status and/or because of the inability to land the multimillion dollar contracts that Phelps, Ledecky, and Lochte have is the subject of another chapter.
- 5.
Again, the 2SLS approach of Brown (1994, 2011) returned an estimated coefficient on Olympian swimmers of just over $32,000; but, this result is not statistically different from zero. Still, we may want to be conservative with the lower bound estimate from the average marginal revenue product calculations in Table 7.2.
- 6.
The EADA survey reports that the average cost per swimmer of a collegiate swim program is $6500. If scholarships were not restricted about three times, the amount of high school swimmers would be competitive for college teams. Thus, (qt – qr) is estimated to be 30,687.
- 7.
As reported in https://www.usatoday.com/story/sports/college/2018/03/07/ncaa-reports-revenues-more-than-1-billion-2017/402486002/ accessed 06/19/18.
- 8.
The average marginal revenue product minus the average scholarship multiplied by the number of collegiate swimmers: ($25,575 – $16,000)*10,822 = $125,264,650.
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Harris, J.S., Kline, A. (2020). Market Power, Rents, and Deadweight Welfare Loss in Collegiate Swimming. In: Harris, J.S. (eds) The Economics of Aquatic Sports. Sports Economics, Management and Policy, vol 17. Springer, Cham. https://doi.org/10.1007/978-3-030-52340-4_7
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