Testing Labor Market Efficiency Across Position Groups in the NFL

Abstract

This article proposes a new metric to proxy for the incidence of player absences faced by National Football League teams based on the percentage of team payroll resources that are inactive over the course of a season. This variable significantly predicts team performance. Calculating this measure for individual position groups allows me to test for differences in the marginal impact of salary resources across these groups. Results indicate that resources dedicated to offense, in particular to offensive linemen and starting quarterbacks, have the highest marginal impact on team performance. This suggests a market inefficiency where these players were relatively underpaid.

Keywords

market efficiency sports economics NFL labor markets

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