Category Archives: College Sports

A Free Market for College Athletes

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My latest for the Huffington Post — What Sports Illustrated Didn’t Tell You About Paying College Athletes – is obviously a response to a recent article from Sports Illustrated.   In the article I advocate a free market for college athletes.

Last August, Robert McCormick and Robert Tollison offered another alternative. In Subversion of the Academy by the NCAA, these two economists noted that the problem in college sports is that the coaches and administrators participate in a free (although quite distorted) market while the labor is treated as amateurs.  If one doesn’t like letting the players participate in a free market, why not have everyone go back to being amateurs?  In other words, let’s return college sports to what it was before people realized money could be made.

Whether one wishes to see a completely free market for everyone or everyone be treated like the players (i.e. everyone is an amateur), it does seem clear that having one institution for the players and another for the coaches seems to be a big part of the problem.  And until that disconnect is resolved, so-called “scandels” will continue to be a part of college sports.

- DJ

Darren Rovell Shows us that Michigan is a Winner

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Classes start this week at Cal-State Bakersfield.  So I should have spent my day working on preparing either The Economics of Religion or Intermediate Macroeconomics (the two courses I teach this quarter).  But I would rather comment on three items I saw on three of my favorite blogs.

These comments will be presented in three separate entries, with this entry focusing on a post from Darren Rovell at his Sports Biz blog.

Last week Rovell made the following observations regarding Appalachian State’s upset of the Michigan Wolverines.  

If Appalachian State sells out every home game this year, they will make roughly $2.1 million (charging a little more than $20 a head with 16,650 seats per game. Michigan has sold out all eight home games already for this season and, get ready for this: the school pulled in $5 million for Saturday’s home game alone in ticket sales and that’s after cutting a check for $400,000 to Appalachian State.

That’s not even the best numbers though. For that we have to go to the budgets–last reported to the government as part of the equity in athletics reporting from the 2005-06 season. That year, Michigan and Appalachian State had the same amount of football players (116). But Michigan spent nearly three times more on each player ($20,180 vs. $7,715).

In part due to payouts, Appalachian State’s football program earned $4,069,038 that year compared to Michigan, which pulled in an amazing $50,365,537.

After expenses were deducted, Appalachian State’s football program earned $1.3 million to Michigan’s profits of nearly $38 million.

These numbers appear to contradict the sentiment expressed by NCAA president, Myles Brand.  Brand claimed that only six Division I-A  programs have made a profit in the past six years.  If Rovell’s numbers are to be believed, how much are the other Michigan sports programs costing? Or is Michigan one of the lucky six?

Brand also has told us the primary mission of the NCAA was education.  With Michigan losing to Oregon we suspect head coach Lloyd Carr might soon lose his job.  We suspect this because it seems to be the case that college football teams fire their coaches when teams do not win as much as is expected.  Given Brand’s comments I have to ask, will Carr lose his job because losing reduces the education of football players?  And what study has shown a clear link between losing and education? 

- DJ

Here are the other two entries in this three-part series:

JC Bradbury Asks for Better Stats

Stephen Dubner Notes the Power of Disgusting Advertising