Allocation Of Players Research Articles

Formation of Coalition Structures as a Non-Cooperative Game

The paper defines a family of nested non-cooperative simultaneous finite games to study coalition structure formation with intra and inter-coalition externalities. The novelties of the paper are: a definition of every games embeds a coalition structure formation mechanism. Every game has two outcomes - an allocation of players over coalitions and a payoff profile for every player. The family is parametrized by a maximum coalition size in every coalition structure (a partition) in a game. For every partition a player has a partition-specific set of strategies. The mechanism portions a set of strategies of the game (a Cartesian product) into partition-specific strategy domains, what makes every partition to be itself a non-cooperative game with partition-specific payoffs for every player. Payoffs are assigned separately for every partition and are independent from the mechanism. Every game in the family has an equilibrium in mixed strategies. The equilibrium can generate more than one coalition and encompasses intra and inter group externalities, what makes it different from the Shapley value. Presence of individual payoff allocation makes it different from a strong Nash, coalition-proof equilibrium, and some other equilibrium concepts. The paper demonstrate some applications of the proposed toolkit: for non-cooperative fundamentals of cooperation in a coalition, Bayesian game, stochastic games and construction of a non-cooperative criterion of coalition structure stability.

Testing Coase theorem: the case of free agency in NBA

This study seeks to test the applicability of the Coase theorem to the allocation of players within. According to the Coase theorem, a player's final allocation would be the same no matter who has ownership of his playing rights if there are no transaction costs. What ownership affects is just the allocation of wealth. Using data from the National Basketball Association (NBA), this article argues that player mobility is likely to be affected by player ownership due to transaction cost imposed by the institution. It is also concluded that performance indicators used for value estimation vary by position and that this also affects player transfer.

Comment: "Professional Team Sports Are Only a Game: The Walrasian Fixed-Supply Conjecture Model, Contest-Nash Equilibrium, and the Invariance Principle"

In a recent article in this journal, Stefan Szymanski develops a generalized version of the two-team diminishing marginal revenue model of win percentage determination and talent allocation. The standard version of this model assumes a fixed supply of talent for a given season, focusing on the allocation of players among teams. Szymanski claims that this assumption is inappropriate and offers his generalized model as a solution. This comment argues, on the contrary, that the fixed supply assumption underlying the standard model is appropriate for its usual applications, given the “peculiar economics” of sports labor markets.

Competitive Balance and Free Agency in Major League Baseball

In 1976, the Basic Agreement introduced free agency to Major League Baseball; previously, the reserve clause gave a team indefinite monopsonistic rights to a player's services. Owners claimed that the new system would enable large market teams to destroy Major League Baseball's competitive balance. Coasian logic, however, would suggest that player allocation would not be affected by free agency. Because player distribution would not change, the Coase Theorem implies that free agency should have no effect on competitive balance. My paper tests this claim by developing an econometric model of competitive balance in Major League Baseball.

Property Rights and Unilateral Player Transfers in a Multiconference Sports League

According to the invariance hypothesis, the allocation of players in sports leagues is the same, regardless of who owns their property rights. However, when a player moves to a new team, the absolute quality of the new team increases while the absolute quality of the former team decreases. This implies that intraconference teams will be willing to bid more for players than interconference teams. However, the asking price for player sales to intraconference teams will be higher than for interconference clubs. If clubs own player property rights, the intraconference effects are built into the ask/bid price. When players own property rights, however, the effect of the transfer on the former club’s revenue stream is ignored. This suggests that free agency should result in a higher percentage of intraconference player transfers than player sales. Player sale data from 1964-1975 and free agency data between 1976-1992 reveal evidence consistent with theory.

'Who's on first': an empirical test of the Coase Theorem in baseball

Because of their highly developed skills, major league baseball players generate significant economic rents. According to the ‘weak version’ of the Coase theorem, the allocation of these players is independent of who controls the rights to these rents, which depends on the rules governing competition in the baseball labour market. The rules of Major League Baseball establish a dual system. For senior players the market is competitive, and players have the right of ‘free agency,’ allowing them to attempt to contract with the team of their choice; for players with fewer years of experience the market is monopsonistic, and a player's right to play baseball is owned by his current team. Consequently, we simultaneously observe two different allocations of property rights. Using individual player data for 1979 and 1980 we test whether baseball player movement is independent of the ownership of these rents. We estimate the wage (marginal revenue) determination process for free-agent and non free agent movers and non-movers. This permits us to generate expected gains from a move for both free-agent eligible and non free-agent eligible players. Coase's theorem is tested by determining if both player types, and, hence, player allocation, are equally responsive to gains from migration.

Monotonic solutions of cooperative games

The principle of monotonicity for cooperative games states that if a game changes so that some player's contribution to all coalitions increases or stays the same then the player's allocation should not decrease. There is a unique symmetric and efficient solution concept that is monotonic in this most general sense — the Shapley value. Monotonicity thus provides a simple characterization of the value without resorting to the usual “additivity” and “dummy” assumptions, and lends support to the use of the value in applications where the underlying “game” is changing, e.g. in cost allocation problems.

The Long-Run Effects of Abolishing the Baseball Player Reserve System

PROFESSIONAL sports have been exempt from United States antitrust laws governing restraint of trade because of an important industry characteristic: a good season results only if teams are fairly well matched and play exciting games with uncertain outcomes. The antitrust exemption has allowed owners to develop the reserve system for the ostensible purpose of attaining and maintaining league balance. The reserve system consists of two components: (a) noncompetitive amateur draft selection by professional teams, the teams with the poorest records selecting first; (b) the signing of a professional player contract which gives the team owner the right to retain or sell the skills of the player.' The question of interest in this paper is what effect the abolition of the reserve clause will have on league balance and the existence of teams which are marginal when the system is in operation. Rottenberg2 and Demsetz3 argue that the reserve clause does not affect player trades or team balance because the same allocation of players will result regardless of who owns the players' skills. Rottenberg further argues that the player draft in which the worst teams select first is equivalent to income redistribution among clubs and that a system of money transfer can be substituted. But industry spokesmen argue that due to high competitive salaries, which would be paid if the reserve clause were abolished, the wealthiest team would sign up all the best players and the marginal teams would go out of business. Obviously the allocation of players will be affected if some cities lose their teams! In their powerful articles, Rottenberg and Demsetz do not give a complete analysis of the baseball market--they do not address the long-run problem of possible team dissolution should the reserve system be abolished. This paper

Antitrust Principles and Collective Bargaining by Athletes: Of Superstars in Peonage

For years the impact of antitrust principles on the arrangements allocating players among teams in professional sports has been hotly disputed. Now recent events seem to have brought this issue to a head. A malaise among good athletes like Curt Flood has increased the tempo of litigation, and an important voice in the United States Senate, Senator Sam J. Ervin, Jr., has responded to a petition for an antitrust exemption for the proposed basketball merger by calling for a full scale legislative review of the issue. We enter this crowded arena, not to solve the antitrust dilemma, but to put it to rest. For, in the form in which it is generally debated, it is an issue whose time has come and gone, an issue which has suffered that modern fate worse than death: irrelevancy. We are strongly of the view that the dispute over the impact of antitrust on the allocation of players in professional sports has, by focusing so intently upon merger and group boycott questions, generally overlooked what may be a dispositive consideration: national labor policy. For while the antitrust issue has been debated in much the same terms for more than a generation, the employment relationship in many professional sports has undergone a major change. In professional football, basketball and baseball, the players are organized in unions which are recognized by, and bargain with, their leagues. The establishment of collective bargaining, however, is not simply a change in economic structure. It also entails a change in