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April 6, 2007

The connection between coaching salaries and making book

ncaa-logo2.jpgThe questionable nature of the NCAA's regulation of intercollegiate athletics has been a frequent topic on this blog, and two recent posts point out a couple of the perverse effects of that regulatory scheme.

First, in this Sports Economist post, Berri points out that the exorbidant salaries being paid to coaches at the top levels of college football and basketball are a direct result of the NCAA's regulation of player compensation:

The research of Robert Brown and Todd Jewell indicates that a future NBA first round draft choice will generate more than $1 million in revenue each year in college (and this was based on data from 1996, so the $1 million figure understates the revenue generation occurring today). Clearly this sum greatly exceeds the cost of a scholarship. Because the NCAA does not compensate the players for the money being generated, this money has to go elsewhere. It seems reasonable that much of this money is currently flowing into the pockets of the coaches. But if the players were paid, the money would not be available to the coaches, and consequently wages paid to coaches would decrease.

Meanwhile, in this Wages of Wins post, Stacey Burke points out that the NCAA's restriction on player compensation also promotes point-shaving, even at such remote outposts as the University of Toledo!:

I think it is a shame that any player (college or pro) shave points or fix games, but the real shame is on the NCAA. College athletes – like men’s basketball and football – who generate large sums of money for their schools are not receiving a salary for their time and effort. This lack of payment occurs so that the NCAA can maintain the appearance that college games are amateur contests. Who does the NCAA think they are fooling? If the NCAA was willing to allow paying college athletes this would substantially reduce the incentive of point shaving.

Again, for decades, university presidents have been easy money for the owners of professional football and basketball teams, who have foisted the risk of capitalizing a minor league system for developing players on the colleges. This appears to be changing somewhat in basketball, where several minor professional leagues are now competing with the colleges for players. But the situation is not going to change for good until the colleges do one of two things -- either embrace professional sports and manage the AAA minor league teams as owners do in the baseball minor leagues or convert intercollegiate football and basketball to the college baseball model and force the owners of professional football and basketball teams to capitalize their own parallel minor league systems.

Frankly, I don't really care which approach the university presidents choose. I just want them to get on with it by showing the courage and leadership to turn their back on the antiquated hyprocrisy of the currently bloated NCAA regulatory scheme.

Posted by Tom at April 6, 2007 4:14 AM |

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