U.S. Labor Market Regulation and the Export of Employment: Major League Baseball Replaces U.S. Players with Foreigners

45 Pages Posted: 17 Sep 2003  

Joanna Shepherd

Emory University School of Law

George B. Shepherd

Emory University School of Law

Date Written: 2002

Abstract

Our analysis of the market for professional baseball players shows that domestic labor-market restrictions have reduced domestic employment, especially of African-Americans, with employers instead shifting employment overseas. Our theoretical model suggests that, in 1965, the imposition of both the player draft and stricter age minimums for hiring U.S. players reduced the benefits of signing and developing U.S. players, especially players from disadvantaged groups such as African-Americans. Our empirical analysis, using a new data set, then shows that, in response, teams have shifted to developing and hiring players from other countries where the regulations do not apply, such as Latin America.

Keywords: labor law, sports economics, labor regulation, racial discrimination

JEL Classification: J0, J1, J4, J5, J7, L1, L5, K2

Suggested Citation

Shepherd, Joanna and Shepherd, George B., U.S. Labor Market Regulation and the Export of Employment: Major League Baseball Replaces U.S. Players with Foreigners (2002). Emory Law and Economics Research Paper No. 7. Available at SSRN: https://ssrn.com/abstract=370422 or http://dx.doi.org/10.2139/ssrn.370422

Joanna Shepherd (Contact Author)

Emory University School of Law ( email )

1301 Clifton Road
Atlanta, GA 30322
United States
404-727-8957 (Phone)

George B. Shepherd

Emory University School of Law ( email )

1301 Clifton Road
Atlanta, GA 30322
United States
404-727-6978 (Phone)
404-727-6820 (Fax)

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