salary cap – The Sport Journal

NBA Players’ Pay and Performance: What Counts?

Authors: Kevin Sigler and William Compton

Corresponding Author:
Kevin Sigler, PhD
601 College Road
Department of Economics and Finance
Cameron School of Business
UNC Wilmington
Wilmingtomn, NC 28403
siglerk@uncw.edu
910-200-2076

Kevin Sigler is Professor of Finance in the Cameron School of Business, UNC Wilmington

William Compton is Professor of Finance in the Cameron School of Business, UNC Wilmington

NBA Players’ Pay and Performance: What Counts?

ABSTRACT
The stars in the National Basketball Association (NBA) are paid handsomely. In the 2017-18 season Stephen Curry received over $34.7 million and LeBron James made over $33.3 million on the court. Prior studies show that players are paid for points scored, rebounds, experience, assists, blocks, field goal percentage and fouls. But the NBA is evolving. Teams over the years have gone from seldom shooting the 3-point shot to making it the focus of their offense. Analytics that first received much attention in baseball with the money ball phenomenon are now in all sports as well. This study accounts for the change in the game by not only including significant variables from prior studies but by also incorporating the 3-point shot and the Hollinger player efficiency rating (PER) in analyzing what counts in determining NBA players’ pay. The researchers find that points, player experience (years in the league), assists, rebounds and fouls are statistically significant factors when it comes to paying NBA players but we also discover that 3-point shots made and Hollinger’s PER are insignificant. In addition, the researchers perform a backward stepwise regression eliminating insignificant independent variables one at a time (least significant each time) until the model includes only significant variables. Again, the same variables are statistically significant although the statistics for the stepwise model improve over the original model.
(more…)

Determinants of NBA Player Salaries

Submitted by Dr. Robert Lyons Jr.1*, Dr. E. Newton Jackson Jr.2*, Dr. Aaron Livingston3*

1* Associate Professor, Sport Management, Queens University of Charlotte, Charlotte, NC

2* Professor, Sport Management, University of North Florida, Jacksonville, FL

3* Assistant Professor, Sport Management, Hampton University , Hampton, VA

Abstract

Determining the factors that influence National Basketball Association (NBA) owners to pay players is of great importance in light of financial constraints such as the NBA salary cap. The purpose of this study was to identify the performance variables i.e. scoring, assists, and fouls that significantly contributed to determine a NBA player’s salary. It was hypothesized that scoring performance variables such as points per game; field goal, free throw, and three point percentage would be significant contributors to player salaries. The authors utilized multiple regression to analyze the 2013-2014 salaries of 243 NBA players and their career performance variables. Results indicated that points per game, rebounds, and personal fouls contributed significantly to a player’s salary. Implications of these findings are discussed in this investigation.

Keywords: National Basketball Association, salary cap, player salaries

(more…)