the sports and society initiative. 2 mission statement: “the sports and society initiative at ohio...

The Sports and Society Initiative

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Mission Statement:

“The Sports and Society Initiative at Ohio State is devoted to the development of a better understanding of the role of amateur and professional sports in the economy and society at large. Its goal is to promote high quality research related to issues of societal concern in sports at all levels through research grants, undergraduate and graduate training and internships, the sponsorship of conferences and interaction with policy makers in sports and related industries.”


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Who We Are

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Our Board of Directors


Janet Box-SteffensmeierArchie Griffin

Matthew MittenShaun RichardGreg StrizekKristin Watt

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Trevon D. Logan, Ph.D.Hazel C. Youngberg Distinguished Professor of Economics

•Executive Board Member, North American Association of Sports Economists

•Past President, National Economic Association

•Winner, Alumni Award for Distinguished Teaching

•Expert on the economics of college football, college sports polls, and college and professional sports betting markets


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Lucia L. Dunn, Ph.D.Professor of Economics• Has taught on the faculties of

Purdue, Northwestern, and the University of Florida where she was the Director of the Business School’s Survey Program

• Labor market expert who has researched and published on athletes’ productivity and compensation

• Introduced the first Sports Economics course at Ohio State in 2003


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Our affiliated faculty includes many other top researchers from the social sciences and

related disciplines at Ohio State


Lawrence Baum, Professor of Political ScienceCharles Emery, Professor of PsychologyRichard Jagacinski, Professor of PsychologyNicole Kraft, Professor of CommunicationsChris Knoester, Professor of SociologyGerald Kosicki, Professor of CommunicationsZhong-Lin Lu, Professor of PsychologyEllen Peters, Professor of Psychology

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The Sports and Society Initiative’s goal is to be the home of cutting edge sports-related research that will inform the current critical debates taking place in policy and academic circles, add to the student experience, and enhance the academic reputation of The Ohio State University.


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Given the enormous presence that sports has taken in all areas of American life and Ohio State’s reputation and prominence in sports, this kind of initiative is a key way in which the public can be made aware of the academic research at Ohio State and where the University’s profile can be enhanced.


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Ohio State does not currently have an organized effort in this area. Many other universities with these kinds of initiatives lack our expertise, prominence, and reputation in athletics and academics.

We seek to leverage our prominence in athletics and the world-class academic reputation we have at Ohio State to become preeminent in this area.


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College Athletics is at a Crossroads

Clearly changes are coming in the world of sports, especially at the amateur level

*Some issues are already getting scrutiny in the U.S. Congress *


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House Resolution 275 – Introduced earlier this year by Representative Rush of Illinois

“To establish a commission to identify and examine issues of national concern related to the conduct of intercollegiate athletics, to make recommendations for the resolution of the issues, and for other purposes.”


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Among the issues to be examined…(quoting from HR #275)

• …how athletics affect the academic mission, academic integrity, and credit worthiness of institutions of higher education

• …graduation rates of student athletes• …expenditures of revenue, including compliance with title IX of the

Education Amendments of 1972, coaching salaries, and facilities development

• …rules related to earnings and benefits by student athletes, including the possibility of commercial compensation for the use of the names, images, and likenesses of student athletes and whether a student athlete may retain a personal representative to negotiate on behalf of the student athlete

• …Federal judicial decisions that affect compensation for student athletes or the right of student athletes to organize as a collective bargaining unit


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ISSUEShould student athletes

be able to unionize?


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ISSUE

Pressures leading to the use of performance enhancing drugs, even at the pre-high school level


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Study in the Journal Pediatrics(2012)

Of 2,800 middle and high school students surveyed in Minnesota:

5 % had used steroids

1/3 had used “unhealthy” methods to increase muscle mass.


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Other Pre-College Issues


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Pay to PlayThe Ohio High School Athletic Association estimates that nearly half of Ohio schools charged students fees to participate in school sports in the 2010-11 school year.

This places an extra burden on low-income families.

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ISSUE

Academic standards and expectations for

student athletes


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ISSUE

Should student athletes receive compensation –

and if so, how much?


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What is a college athlete worth?


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This question is actually two

related questions…


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1. How much is a sport’s revenue dependent upon success?

2. How important are players in that success?


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In professional sports, economists analyze individual player productivity and then estimate a player’s value by looking at the sum of the value of the individual inputs.


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Some Big Problems:

1. We don’t have good measures of all of the components that matter

(especially defense)

2. What about the players who rarely or never play?

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1. Look at college football revenues

2. Look at how recruits are related to performance

3. Infer the value of players by recruit ranking

4. Discuss policy implications


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• ACC – $22.4M• Big 10 - $38.1M• Big 12 - $31.8M

• Big East - $17.9M• Pac 12 - $26.4M• SEC - $44.3M


Football Revenues (by Conference)

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• ACC – $7.1M• Big 10 - $20.3M• Big 12 - $16.4M• Big East - $3.6M• Pac 12 - $10.5M• SEC - $25.7M


Average Football “Profit” (by Conference)Profit = Revenues – Expenses

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Using data for all FBS football programs from 2003 to 2013, I find that:

1) Each win is correlated with $1.64M in revenue

2) Each win is correlated with $1.09M in profit


Winning, Revenue, and Profit

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Using data for all FBS football programs from 2003 to 2013, I find that:

3) A Bowl Game Appearance adds $8.1M revenue, $4.3M profit

4) A Championship (BCS) appearance adds $10.9M profit, $16.0M revenue


Winning, Revenue, and Profit

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Bergman and Logan (Journal of Sports Economics) collected individual recruit data and matched it to on-field performance Five star recruits increase the number

of wins and likelihood of a BCS appearance (much) more than four/three/two star recruits


Inferring Player Value

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Just taking the probabilities from Bergman and Logan and using only wins and BCS/Championship appearances:

Five Star Recruits - $898,880

Four Star Recruits - $217,310

Three Star Recruits - $50,140



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Implications for 2015 Recruiting Classes:

Ohio State - $3.64M (~$14.7M)

Florida State - $6.92M (~$25.2M)

USC - $7.54M (~$24.8M)

Alabama - $7.11M (~$25.7M)



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1) Paying players in proportion to their productivity will eliminate the subsidies in athletic departments

2) This only applies to sports programs that generate revenues in excess of their expenses. This does not apply to the majority of college athletes, and to no athletes at a number of universities


Important Caveats

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3) To regulate payments, institutional cooperation will be more complex, and limits on compensation would be akin to “salary caps” in professional sports.

4) Arrangements for player compensation may have significant effects on competitive balance within and between conferences and could impact revenues in the long term.


Important Caveats

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The Summer Fellows Program

• This program will select student athletes to work as research fellows during the summer to work closely with SSI faculty on research projects.

• This will give athletes research experiences tailored to their interest, enhancing their academic experience at Ohio State.

• Works in concert with the Athletic Department’s Hire a Buckeye program to develop skills that athletes will use in the job market.


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The Summer Institute• This program will provide young

people at the high school level a broad view of career options where they can channel their enthusiasm for sports in a realistic way.


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Roger Noll (1998)

• Present Value of additional lifetime earnings for college football play was about $200,000

• Present Value of additional lifetime earnings for Pro play was about $2,000,000.

• To have a chance of college play, a high school student will devote about 2,000 hours of effort to football over 3 years.

• Given a 3% chance of a college scholarship and a 0.25 % chance of a pro career --- then:

• The expected return for those 2,000 high school hours is about $5.50 per hour.


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Summer Institute• High school students will come to the Ohio State

campus to take part in special seminars on the many rewarding careers that are possible in the sports industry apart from play on the field.

• Careers in sports journalism and broadcasting, statistical analysis, marketing, accounting, sports law, etc.

• As part of our outreach mission, a significant number of scholarships will be provided to deserving students who would otherwise not have the means to take part in the Summer Institute.


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Follow Us!See the latest news on our website:

http://u.osu.edu/sportsandsociety/

Follow us on Twitter:

@sportssociety


the sports and society initiative. 2 mission statement: “the sports and society initiative at ohio...

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