Ownership of property-rights and the allocation of talents |
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Authors: | Haoming Liu |
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Institution: | Department of Economics , National University of Singapore , Singapore 117570 |
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Abstract: | Under the reserve-clause system that assigns the property-rights on the Major League Baseball players’ services to teams, player transfers are negotiated between teams without the involvement of players. In contrast, under the current free-agency system, players with free-agent status negotiate directly with potential suitors. Thus, the system assigns the property-rights to players. Using data extracted from the Baseball Archive (http://baseball1.com), this article examines the effect of the change in the property-rights assignment on the allocation of talents across teams. We find that the change increased large-market teams’ shares of veteran all-star players and the concentration of senior players. |
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