Does Player Mobility Lead to Higher Earnings? Evidence from the Nhl

Abstract

A superficial examination of NHL earnings data shows that players who have changed teams earn more, on average, than players who have not. Extensive media coverage of player movement at trading and free agency deadlines has generated the perception that players on the move are consistently moving to higher salaries. Using career data for players in the National Hockey League, we estimate an earnings function and find, perhaps surprisingly, that the cumulative effect of moving on earnings is negative. Players who have changed teams many times during their careers earn less than those who remained with the same team throughout their career. We show that the negative impact of moving holds for free agents and highly talented players only if they move often.