| Abstract: |
Intercollegiate amateur athletics in the US largely bars student-athletes from
sharing in any of the profits generated by their participation, which creates
substantial economic rents for universities. These rents are primarily
generated by men’s football and men’s basketball programs. We characterize
these economic rents using comprehensive revenue and expenses data for college
athletic departments between 2006 and 2019, and we estimate rent-sharing
elasticities to measure how rents flow to women’s sports and other men’s
sports and lead to increased spending on facilities, coaches’ salaries, and
other athletic department personnel. Using complete roster data for every
student-athlete playing sports at these schools in 2018, we find that the
rent-sharing effectively transfers resources away from students who are more
likely to be black and more likely to come from poor neighborhoods towards
students who are more likely to be white and come from higher-income
neighborhoods. To understand the magnitude of the available rents, we
calculate a wage structure for college athletes using the collective
bargaining agreements in professional sports leagues as a benchmark. We also
discuss how our results help understand how universities have responded to
recent threats to these rents arising from litigation, legislation, and the
global coronavirus pandemic. |