In their study released this week in the Winter 2015 issue of Journal of Economic Perspectives, Allen Sanderson, senior lecturer in economics at UChicago, and John Siegfried, professor emeritus of economics at Vanderbilt, write that the practice of setting a binding limit on remuneration for student-athletes — grant-in-aid restricted to room, board, tuition, fees, and books — may violate the Sherman Antitrust Act.
The authors argue that payment caps set by the NCAA are holding down benefits that otherwise would go to top-performing athletes, many of them African Americans from low-income families, while top coaches and athletic department personnel receive disproportionately high salaries.
Instead, the researchers recommend, schools should compensate student-athletes according to the value they provide, whether that value comes in the form of measurable revenue or more subjective benefits.
Sanderson said recent proposals by the NCAA to shift from single-year to multiyear scholarships, and to cover unrestricted meal plans and other incidental out-of-pocket costs for players, fall well short of a free competitive labor market.
Such proposals “are mainly an attempt by the NCAA to stay one town ahead of the sheriff,” Sanderson said.
In addition to exploring the labor market for college athletes, the paper, entitled “The Case for Paying College Athletes” also examines why U.S colleges and universities operate large-scale commercial athletic programs, with a focus on men’s football and basketball. The authors question the rationale among many universities that such big-time programs subsidize their money-losing intercollegiate sporting ventures. The Student-Athlete Debate