This Article Full Text (PDF) All Versions of this Article: 1527002508329865v1 10/4/335    most recent References Alert me when this article is cited Alert me if a correction is posted Services Email this article to a friend Similar articles in this journal Alert me to new issues of the journal Add to Saved Citations Download to citation manager Request Permissions Request Reprints Add to My Marked Citations Citing Articles Citing Articles via Scopus Google Scholar Articles by Marburger, D. R. Social Bookmarking                         What's this?

Why Do Player Trades Dominate Sales?

Arkansas State University, marburge{at}astate.edu

Although barter is considered to be inefficient, trades are more common than player sales in professional sports. Theory indicates that when owners have identical constant risk averse preferences, the contract zone for sales shrinks relative to that for trades. Moreover, the gap between the two contract zones becomes larger as the expected quality of the player increases. Probit estimations reveal that the likelihood a player is sold rather than traded increases with age and as the percentage of remaining career productivity decreases. An inverse relationship between player quality and the likelihood of sale for is found for hitters, but not for pitchers.

Key Words: invariance hypothesis • risk aversion • expected marginal revenue product • player trades • player sales

This version was published on August 1, 2009

Journal of Sports Economics, Vol. 10, No. 4, 335-350 (2009)
DOI: 10.1177/1527002508329865


CiteULike    Complore    Connotea    Del.icio.us    Digg    Reddit    Technorati    Twitter    What's this?