JOURNAL ARTICLE

The effect of competition on the demand for skilled labor: Matching with externalities in the NBA.

  • Published In: Journal of Economics & Management Strategy, 2024, v. 33, n. 3. P. 539 1 of 3

  • Database: Business Source Ultimate 2 of 3

  • Authored By: Kuehn, Joseph 3 of 3

Abstract

I study how heterogeneity in competition can affect the demand for skilled labor in a way that generates a dispersion in productivity across otherwise similar firms. This is explored in the setting of professional basketball where heterogeneity in competition is easily measured. I develop and estimate a matching model with externalities, where the value of a match between a firm and worker depends on the entire allocation of matches. I find that competition has a significant effect on hiring decisions in the National Basketball Association, resulting in a clustering of talent among rivals. A counterfactual shows that competition in the league's playoff format explains 17.59% of the widely observed gap in talent between the league's two conferences. [ABSTRACT FROM AUTHOR]

Additional Information

  • Source:Journal of Economics & Management Strategy. 2024/08, Vol. 33, Issue 3, p539
  • Document Type:Article
  • Subject Area:Sports and Leisure
  • Publication Date:2024
  • ISSN:1058-6407
  • DOI:10.1111/jems.12582
  • Accession Number:178854228
  • Copyright Statement:Copyright of Journal of Economics & Management Strategy is the property of Wiley-Blackwell and its content may not be copied or emailed to multiple sites without the copyright holder's express written permission. Additionally, content may not be used with any artificial intelligence tools or machine learning technologies. However, users may print, download, or email articles for individual use. This abstract may be abridged. No warranty is given about the accuracy of the copy. Users should refer to the original published version of the material for the full abstract. (Copyright applies to all Abstracts.)

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