Spreading the Game Around the World

According to Sports Business Journal ($), the NBA is proposing lowering rookie salaries by 30 percent in the next collective bargaining agreement. In a bilateral bargaining arrangement (monopsony league and monopoly union), taking from not-yet union members might seem to be a favorable proposal. Even if current players might agree to such a policy change, I think the NBA might want to reevaluate this strategy. With the rise of professional basketball around the world, some of the best young players may choose to play in European leagues where their salaries are not restricted, just as Josh Childress (formerly of the Atlanta Hawks) did.

More American ballplayers jumping to Europe only makes further jumping easier. And sponsors eager to spread their brands worldwide may be willing to subsidize player moves outside the US. The NBA doesn’t have the market power it once did, largely thanks to its own successful promotion of the game internationally.

2 Responses “Spreading the Game Around the World”

  1. Marc Schneider says:

    People should realize that the draft itself is a restraint of trade, albeit one that is sanctioned through collective bargaining today. The idea that leagues can develop “slots” and allocate salaries based on those slots and then discourage teams from “overpaying” is really pretty outrageous. Fans (and a lot of players) frequently complain about “untested” players getting too much money, which ostensibly takes money away from veterans, but in a competitive market (which the draft obviously isn’t), salaries will reflect supply and demand. And sports isn’t the only profession where “rookies” make than one might think they deserve. Players don’t make a lot of money because of Scott Boras; they make a lot because they have scarce skills that are of considerable value to teams. There might be legitimate, pro-competitive reasons for having a draft, but in most cases, it operates as a way of transfering wealth from players to owners, at least initially. I would like to see some high draft picks move to Europe; the heads of U.S. sports owners and fans would likely explode.

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