Yesterday, astounding news draws my eyes: the NBA season this year is now canceled. I felt really terrible when I hearted that news. But it definitely inspired me some thinking into the market of NBA players?
First of all, I think the market of NBA players is not necessarily competitive, at least not as competitive as market of toothpaste. In a competitive market, no individual can have any impact on the price of goods. In the market of NBA players, however, every individual player has essentially different level of wages, ranging from 20000000$ dollars per year to 600000$ annually. Why? The answer to this question is simply: the ability of every individual player is essentially different. That’s one reason amount to the various levels of wages within NBA.
But the different levels of individual ability cannot completely account for the lockout this year. There’re numerous players in Europe, Africa, Asia who are also capable of playing in NBA; the owners of NBA teams also want them since local players refuse to serve at lower wage. Why don’t the NBA owners just find some international players to substitute some of their employees? The answer is the transaction cost is too high: first, they have to help the international players with their visa, green card problem; second, they don’t actually know how well they can perform in NBA; third, even if the international players agree to come to U.S., whether the current owners of those international players will let them go still remains debatable.
What’s more, the union of NBA players also plays an important role in affecting the general levels of wage.
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