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Abstract

We examine the evolution of salary distribution in the National Basketball Association using a panel of all full-time players. We identify three eras using structural break analysis, with breaks aligned to changes in Collective Bargaining Agreements that occurred at the time of lockouts. Our findings show that real salaries have risen substantially across all income levels but not at the same rate. Analyzing the Lorenz curve and Gini coefficient, we observe a period of increasing inequality during the 1990s, followed by a more equitable salary distribution in the early 2000s, and then a return to rising inequality in recent years.

Keywords

collective bargaining income distribution gini coefficient lorenz curve and structural breaks

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A Rising Tide Raises all Boats: The Changing Distribution of Salaries in the NBA Over Time

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