The Freaky Part of the Lockout

Check out Freakonomics for a guest post by none other than our esteemed General Manager David Berri.

Monopoly vs. Monopsony: The Economic Battlefield of the NBA Lockout

Dave reviews some of the problems in the lockout including.

  • Monopolies vs. Monopsonies: As Patrick went over a while back the NBA players have a Monopoly on the talent and the NBA owners have a Monopsony, which means they are the primary buyer of the good. It’s hard to know who will win when these two sides clash but a lot of it has to do with making sure to bargain and leverage correctly, which the players have not been doing.
  • Big Markets vs. Small Markets: As we’ve said the real problem between big markets and small markets is not competing on the field of basketball, it’s in earning money. Dave reviews that in MLB the big market teams decided to subsidize the small market teams. In the NBA the owners are instead asking the players to pick up the check. The players are not happy about this.
  • The Fans Come Back: Finally Dave reminds us that he and Martin Schmidt found out that the fans comeback after work stoppages. So at the end of the day the real losers of this lockout are the fans.

You should hop over to Freakonomics and read the rest. If you really enjoy it make sure to let them know in the comments that Dave should write more stuff for them.

-Dre