Chandler Bentley
Mrs. Straub
AP Economics
September 25, 2014
Athletes: Over or Underpaid?
Professional athletes are some of the most physically gifted people we have in this world. Whether it’s scoring a basket, kicking a goal, or catching a touchdown, professional athletes are few and far between. Which raises the question, what type of salary should they be receiving? The impression for years has been that athletes are ridiculously overpaid. Many would say to earn millions of dollars a year to play sports is simply ludicrous. But nobody had truly studied the economic perspective of this question. We have simply analyzed the perception that athletes work less than the everyday worker, yet get paid exponential amounts of money and have failed to delve into the logical aspects of it. To answer this question, we must look at the economic value athletes have to truly answer the question, over or underpaid?
First, let’s take simply the statistical side of this argument. One of the highest paid athletes in the NBA and arguably the best player in the world, Lebron James, is making approximately $20 million a year strictly from his contract with the Cleveland Cavaliers. Although this may seem at eyesight an extraordinary amount of money for a man who puts a ball in a ring, but look closer. Lebron James is scheduled to bring in up to $600 million to the city of Cleveland simply from his move from the Heat to the Cavaliers. As if this wasn’t enough money, while James was in Miami, the Heat’s net worth skyrocketed from $364 million to $625 million within just four years. Couple that with the millions of dollars of revenue each and every NBA team brings in per year and Lebron James contributes upwards of a billion dollar a year of revenue. Now compare this with Walmart. CEO and President C. Douglas McMillon earns just over $25 million per year in salary and incentives for Walmart, a business whose net income per year is approximately $16 billion a year. Once again, this seems like an enormous amount of money, but compared to the amount of money he makes the for the company each year, he is essentially only being paid a minute amount of the company’s net income per year. Compared to Lebron James, McMillon makes less percent of the net income of Walmart from his salary than James. Comparing general salaries, we can even see from the chart below that the average wage per year of professional athletes is much greater than that of almost every other profession in the world. Chalk up one tally for overpaid.
Switching perspectives, let’s now look at a different aspect of salaries, scarcity. We all know that professional athletes are some of the rarest talents in the world and very few people actually become professional athletes, and not from lack of effort. Athletes are global, from young kids all the way to professionals, but only a minute selection of those young kids ever become the superstars we come to know and love.[i] Although the availability for CEOs is also extremely scarce, the plethora of people that are both equipped and willing to carry out the everyday operations of a CEO are much greater. Although the demand for the number of professional athletes and the number of CEOs seem to be approximately equal, the supply for athletes is much greater for that of CEOs than those of athletes. Now some may say, “doesn’t the supply for athletes outweigh the supply for CEOs considering there are so many kids who want to and are willing to become professional athletes?” Now that may be true, but the same ability is not sustained. If you were to replace the CEO of a company with another CFO, COO, President, or another occupation that is “inferior” to that of a CEO, many of those people could carry out that same CEO position with just as much ability as the one before it. Now take a professional athlete. You simply cannot replace a Lebron James or an Aaron Rodgers and expect the same level of output from that replacement. The marginal benefit of obtaining those extraordinary athletes far outweighs the marginal cost of a couple million extra dollars. It is because of this that we even up the score at one to one.
Lastly, we’ll look at the output of work that professional athletes go through on a day to day basis. Many people would simply revert to the fact that athletes have only half the hours of work per day that an average worker will complete. Although this may sway the majority towards the everyday worker, we haven’t accounted for the everyday physical demands that the athlete must go through. The physical toll an athlete takes on his body is much greater than that of a normal worker. The work rate of an athlete in the moment are much greater than that of any other profession and although it may not seem as mentally dependent as other occupations, the amount of mental concentration and training that an athlete must take is just as great as the next man. The question is, what is more harsh on the body, harder work for less time, or easier work for more time?
In total, athletes are some of the highest paid people on the planet. Whether it’s Lebron James, Aaron Rodgers, or any professional athlete between, the debate will continue upon the salary of athletes. Each side has its merits with either the profit they produce, the scarcity of their skill, or the efforts they put forth. So the answer is up to you. Under, over, or just right?
Bibliography
"NBA Team Valuations." Forbes. Forbes Magazine, n.d. Web. 26 Sept. 2014. <http://www.forbes.com/lists/2010/32/basketball-valuations-11_Cleveland-Cavaliers_324902.html>.
"Millionaire athletes who lost their millions – How to spend like a professional athlete.." Finance my Money RSS. N.p., n.d. Web. 25 Sept. 2014. <http://financemymoney.com/millionaire-athletes-lost-millions-of-dollars-professional-sport-salary/>.
Manfred, Tony. "Here Are The Odds That Your Kid Becomes A Professional Athlete (Hint: They're Small)." Business Insider. Business Insider, Inc, 10 Feb. 2012. Web. 23 Sept. 2014. <http://www.businessinsider.com/odds-college-athletes-become-professionals-2012-2?op=1>.
[i] For more information and statistics on the odds of becoming a professional athlete, visit Here Are The Odds That Your Kid Becomes A Professional Athlete by Tony Manfred.
I think that some of the information that you bring up is very interesting, and things that a lot of people might not notice about professional athletes at first glance. I like how you compared Aaron Rodgers with Lebron James because I think that just makes your argument all the more reasonable. However, I think it would be good to not just sit on the fence like you do. You should probably chose a side that you think is more right, and stick with that opinion. I personally think that professional athletes are overpaid, especially since a lot of the money they make is largely based on their reputation, but you should take a stance in your argument, otherwise it really isn’t an argument. Overall, though, good job! Your piece is nicely written, and the information you provide is interesting and relevant.
ReplyDeleteFirst of all this post was well written and made me want to continue reading despite the length. Second, I personally think that professional athletes are overpaid. Looking at the "work" they do compared to that of a surgeon or somethings there is no way that they deserve that much money. But then you brought something to my attention that threw me a curve ball. When you said Lebron brings in something like 600 million dollars to the city of Cleveland it made me think, wow it's the least they could do to give him 20 million of it.
ReplyDeleteI am one of the people who agrees with the salaries of professional athletes. I agree that they are being paid a just amount because of the revenue they bring in, and also the amount of charity work that is done by professional athletes is huge. This matters because they are putting even more money into the city and the community, so why wouldn't you pay them their fair share? Especially when they are possibly the biggest face in that city or even that state. If a minor league prospect for the Brewers was doing David Gruber commercials instead of Aaron Rodgers, the ads would attract a lot less attention, therefore decreasing the profits of everyone involved. So athletes should be paid millions of dollars a year because of the portion of the city that they contribute to.
ReplyDeleteAfter reading numerous blog posts about the income of athletes, and if it’s fair or not, I always believed that these people were being overpaid. But after reading your post, you brought up some really great points on how they are being paid just right, or even underpaid. Using your first example of Lebron James, I was very surprised at how much the net worth rocketed once he moved teams to the Miami Heat. If he can affect the income that much, he surely should be getting paid for his actions and contributions to the team. Another great point you made was about scarcity, and how rare these athletes really can be. It is true that if you were to replace a CEO of a company, that mostly everything would remain the same, but replacing an athlete is a completely different story. Overall, your post completely changed my opinion and views on the income of athletes, and I now believe that they may bring in more than we all may know, clearly showing they’re being either paid just right, or even underpaid.
ReplyDeleteHonestly, if you think about it, professional athletes are greatly over payed. Yes, the do provide nation wide entertainment, but that entertainment isn't worth a billion dollars. That's down right insane. I understand how difficult being a professional athlete can be, but that doesn't mean they deserve to be payed roughly 10,000 times more money than the stranded office worker. Lets be real here, even though their work is hard, its only worth a few million at most. While these people make billions, everyday family's are struggling to survive.
ReplyDeleteI believe that some athletes are under payed, but generally, most athletes are payed the right amount. Some people might think they are over payed because of the enormous salary they get, but in reality, they help improve the economy for the cities they play in. Like you said above, Lebron James brought in nearly double the net worth of the Miami Heat when he was traded there. If a player can bring in that much money, he deserves what he's getting paid. I like how you made your article arguable.
ReplyDeleteThat was a beautiful post Chandler. As I was reading I was thinking to myself what I thought about the topic, if athletes are overpaid or underpaid. One example I thought of right away was Floyd Mayweather Jr. who just recently got paid 70 million dollars for one single fight. I think in that case that certain athlete is overpaid even with all of the body blows that he takes, and the amount of time that it took him to train. But if you look at an NFL player the average player makes almost 2 million dollars a year which is lower than the NHL, NBA, and the MLB. If you take into account the body blows, and multiple times in the hospital, and the risk of lifetime injuries I think that they are underpaid. But world class athletes do more than just play they bring in money to the stadium and the city to watch them play. It was a good argument that you brought up and still has me thinking about my stance on the question. Good job.
ReplyDeleteThis piece is very well written. I think you did a great job of finding a topic that you were interested in and actually put some good thoughts in. Being that your writing was sports related, I noticed you decided to incorporate a score into the debate. That was a good touch. I guess if you were to add anything, maybe comparing the lowest paid athletes or maybe the average salary to the average worker would gives us another perspective on the salaries and help us better distinguish whether athletes are over or under paid.
ReplyDeleteI agree that although the salaries of professional athletes may seem outrageous, it does make sense. Not only are the athletes just paid to show off their extraordinary talents, they are also paid for the risk involved. Everyday an athlete trains, practices, or competes- they are at risk for great injury. The risk is an accepted part of the job for a professional athlete, for CEO s on the other hand, concussions and shattered bones aren't something to be expected. Considering all other aspects of the job, I believe that professional athletes are paid the right amount for their performances.
ReplyDeleteWhile most athlete's salary is absurd, I think it is right where it should be. You bring up some really important points like how much money they bring to the team and community. That money I believe is taken into account when they choose the salary. We all know Lebron James did not start off making that much money, just like a CEO. You earn the money with hard work and great performance. CEO's aren't born CEO's they work their tails off to get there just like the professional athletes. You made a great point that a lot of kids dream of being a pro athlete but about 1% -not even- make it that far. When the sport and franchise themselves are making a lot of money why not reward the people bringing in the most money?
ReplyDeleteYou did a great job including economic terms and describing how sports entertainment affects the economy. I personally believe that athletes are wildly overpaid, sure they are incredibly gifted, but so are people with a typical job, just in different ways. We saw a short clip about the distribution of wealth and that the top 1% of wealthy people in America hold nearly 40% of the entire nations wealth. These athletes are often apart of the 1% and while they are deserving of a decent salary, they make millions of dollars per year which seems a bit excessive. Overall, this was a great topic choice and really well written, nice job.
ReplyDeleteI believe that the athletes are paid just right. Lebron James brings in millions of dollars every year for whatever team he plays for. In fact I've heard that sports annalist have said that Lebron James is underpaid compared to the other professional athletes. Something that wasn't considered when comparing Lebron James to a CEO was that Lebron James won't be able to compete in the NBA as long as a CEO will be able to run a company. Professional Athletes have limited time in their career. In the NFL the average career only last about four years. Overall this was a very good topic and I believe that athletes are paid the right amount.
ReplyDeleteThis is a great topic and I agree that the salaries for professional athletes are accurate, even thought the may seem overpaid. Athletes work extremely hard for the money they earn. However, being a professional athlete not only requires them to be training 24.7 to improve their athleticism, but there is also a huge risk in what they do. Everyday millions of athletes get hurt by simply doing their job, but they can't complain because it is a part of their profession. A lawyer, does not have that severe risk of injury like an athlete does. Therefore, it makes sense due to the risk factor of the job, that professional athletes do get paid the high amount of salary that they do.
ReplyDeleteI love your topic brings so many questions to my mind. I thought at first "god your dumb" but then I started to think about how money effects us. Everyone of us has a chance to work and make money people always say "Oh work sucks" actual hard work is known by only a select few, not even the athletes know what it is. I don't even know but, I do know they and I don't work hard we work to the best of our mental capacity. Anyway, it doesn't really matter because it's not going to change anyway.
ReplyDeletePersonally I believe that professional athletes are getting paid just the right amount, some of the superstars may even be getting underpaid. Take the LeBron example, he is bringing so much money into whichever city he decides to play for, that he deserves every dollar he makes, if not more. He is a major asset to the team he plays for and needs to be rewarded for that. Athletes choose to play sports as a career, and should be paid a large amount while they play because they can’t play for as long as say a salesman can sell. They’re health and strength only lasts so long, so they should make enough money during this time to live comfortable enough for the rest of their life. I know that some athletes spend their money stupidly, but those who do not shouldn’t need to pick up another job after retirement. They chose to be an athlete, they just can’t be as long. They risk their health and social lives to entertain the nation, be role models for kids, and deserve the money they get because of it.
ReplyDeleteWe all see the salary of a professional athlete and immediately go to the idea that it is way too much, but really it never is. I would like to talk about the fact that professional athletes will not have a job as long as an everyday worker. Many of their bodies cannot withstand the physical demand and many destroy their bodies in an effort to entertain us at their games. It is very true that professional athletes work hard for every dollar they earn and their team rewards them with higher pay, even the community rewards them by giving the team more money to pay the athlete with. Overall after reading this post my opinion on over paid professional athletes has changed.
ReplyDeleteI really liked your point of view on the subject, because you brought up a point mos people do not recognize. Yes, athletes are paid absurd amounts of time frame they can work from is very small compared to the average person. Therefore what they make has to last them a long time, and the salary becomes smaller in comparison. f money, but they are the best at what they do. Also, as you pointed out an athlete
DeleteI really liked your topic on if athletes are overpaid, underpaid, or paid just right. I really thought that athletes have been getting overpaid but you made some really good points which makes me think that they could be getting paid the right amount. I was surprised by how the Heat’s net worth skyrocketed from $364 million to $625 million within just four years once Lebron James switched teams. It clearly shows that Lebron James has been working hard and putting a lot of contributions into it since he affected the income so much. Overall, I really liked your topic and the thoughts that you had to say about athletes pay and it really made me think more now if they really aren’t getting overpaid and that they could be getting paid just right.
ReplyDeleteThis was one of the most interesting topics that I have read on this blog. I have always thought that athletes are way overpaid similar to reasons that were mentioned but your post completely turned my opinion around. I never took into consideration the massive amount of money the athletes bring into different cities. From an economic perspective, the amount of money they are getting paid seems just right! Another point that I think was important was how these careers are completely different from any other job. The athletes go through intense training all year round and are constantly in perfect shape to maintain their job. Just like any other career, if they do not complete the task that they are supposed to (win or do good) they will get fired or cut. Although it may not seem like a lawyer and a professional athlete's job are similar, they actually are! I also liked how you talked about the demand and supply of professional athletes. It made me understand more about supply and demand but in an actual real life situation. Overall, I think that they are getting paid the right amount from an economic stand point. This piece was very well written and I actually enjoyed learning more about this topic.
ReplyDeleteI really liked your piece. I used to think athletes always got overpaid, but you have to notice that these professionals are only getting paid high amounts for about ten years and after that they don't have any skills to go out in the real world. Some famous players go into broadcasting for the games but that is about it. People have got to put in perspective that these athletes especially football athletes are getting beating to them every week so that takes a tole on your body. So in the end getting paid these high amounts will help the athlete in the long run with medical bills and taking care of their family if they are smart with their money.
ReplyDeleteThis is a very heated debate that will continue on. Another aspect to consider in this debate, is the fact that the top athletes also get a high salary from sponsors. Being a top athlete comes with much fame and thus companies wish to put top athletes in their commercials. Since only few athletes are of the level of quality needed for a commercial resources are scarce and companies must pay the athletes high salaries to book them for these commercials. This is not the case with an average worker or CEO because they are not famous and thus do not have this option for additional income.
ReplyDeleteI like how you don't directly take a stand on whether the athletes are overpaid or not but simply state the facts and have the audience decide instead. Also, a common and current issue that people discuss today about our nation's workers and athletes. But, may I bring up the point of not just CEO's of companies like Walmart who may make a lot for not exactly doing much but a head director of corporations and institutions like NASA. Could these people be overpaid? Because recently, there hasn't been any launches sent from the US because we are currently taking a break, according to the government, but could it be that these people are getting paid for "how smart they are"? Could other people in the nation get paid today by "how smart they are", not necessarily creating anything new recently but based off their status? Just something I thought of, overall you chose a great topic to review and discuss as it brought many comments with more ideas to come and other thinkers to branch off your topic. Nice job!
ReplyDeleteI really liked your piece. I think some athletes are over paid, but some deserve the pay that they get. I think the league that spends the most money on athletes is the MLB. when ever someone from the MLB gets a new contract it's worth a lot of money and by a lot I mean about $10 Million per contract. Other sports are careful of what they pay their athletes like the NHL the highest contact ever has been $130 Million, but that was for only one player. Usually contracts don't go any higher than $15 million depending on the length of the contract. Some of the players in the NHL only have $1-$5 million dollar contracts which seems about right for someone who is a professional athlete. Although some sports pay more than others for playing a professional sport, Depending on the sport some athletes are over paid and some athletes are not over paid.
ReplyDeleteI thought that you helped bring a whole new perspective to the argument of whether professional athletes are paid too much. You convinced me with the scarcity argument that professional athletes are much less replaceable than the equally paid CEOs of fortune 500 companies, which also brings to light the inquiry of whether or not CEOs are paid too much. Also, considering the sacrifices an athlete makes in order to be the best and also the revenue brought into the cities that they play for, athletes seem to deserve to be paid a lot, but I still can’t conclude exactly what they deserve to be paid.
ReplyDeleteChandler, I thought the way you presented the facts, by not choosing a side really made the article more enlightening, as we did not have to try and see through your bias. Personally, I find this topic very interesting because I love to watch sports and hearing what some of these players make is mind blowing. It is also interesting to consider the fact that even though they make way more money than most people, a large percentage of ex NFL players end up going bankrupt during their lifetime, something that does not happen to many CEO's. There is also the fact that the risk of injury is extremely high being an athlete so shouldn't they be compensated for that risk? Overall, it is an interesting topic, and you presented the facts well.
ReplyDeleteChandler, this is an astounding topic to shed light to. I thoroughly enjoyed reading about how the salaries of such impeccable athletes compares to the salaries of CEOs’ in some of the biggest industries worldwide. In my view of this subject I believe that athletes in society today are paid essentially just the right amount. When you take into consideration how much the average persons life is consumed by the different athletic sponsorship's and intake. I overall think that you did an amazing job on this piece of writing and brought new insight in the relm of athletics as they relate to economics.
ReplyDeletePersonally, the piece would have been better if you had taken a side, whatever side that may be. Also, your comparison between a CEO and a professional athlete doesn't prove many facts, it would have been better if you chose a lower paying job since the skill sets of a CEO and an athlete are completely different. The biggest thing for me was not taking a side, That's what is most important.
ReplyDeleteFrom your piece, I thought you brought a whole new understand and perspective as to why professional athletes are paid such a great deal of money. Where I was convinced the most is when you stated that there really is not a replaceable Lebron James or Aaron Rodgers, at least to their caliber of play, that could bring such an impact to the community as a whole. It was made more clear to me that individuals like Lebron James bring in $600 million as you stated, to the community which overall effects the state as well. Professional athletes are a rare breed in the sense of their accomplishment, which made me realize why to an extent female or male athletes get paid as much as they do; however I still do not agree that $20 million for example is an appropriate amount to give to an individual, but I am not completely sure what the right amount would be overall.
ReplyDeleteI believe that Professional athletes are payed the correct amount for the time and dedication that they put in on a weekly basis and for what they did to earn it before they became a star. Secondly professional athletes put their body through much more than that of a regular worker as well as the fact that in every sport there is a risk for serious injury. For example Stanton on the Miami Marlins was hit with a 90 MPH plus pitch in the face which caused major trauma and damage to his face. It is common to hear about season or career ending injuries in the NFL and most of the time NFL players never reach the point where they receive pension which requires 4 years of play in the league.
ReplyDeleteYou brought some interesting points to light, however we have to consider why the demand grew to be so high. These athletes are worth so much to the public to the point that they got paid to this extent. Athletes have become an Icon, and the teams have to pay big to keep their Icons. The players are what make the games exciting for the masses. Bad players make bad icons and attract very little. Just look back at the brewers before 1982. Suddenly they had some good players and they went to the playoffs. Boom, the brewers had a fan-base again. These players are clearly worth the money. There's just too high of a demand for them to be worth any less.
ReplyDeleteI thought that you did a great job with the detail and the idea with if they are over or under paid. Although, I do believe that it doesn't really cross a persons mind economically. And, the idea of a "normal worker" is different to everybody. Some jobs will actually take a harder toll on a persons body. Such as a person hanging drywall for twelve hours a day for six days a week, their body is in much worse shape than a person that puts a ball in a hoop. Overall, I believe that you did a great job picking your topic!
ReplyDeleteChandler, this is a quite interesting topic to bring up, and it is one that will be debated as long as professional sports are played because of the strength of both arguments. That being said, I do feel as though athletes are overpaid because of the scarcity of those willing and ABLE to do the work. The market is working at a shortage, and by operating at this shortage, a black market of sorts is created through free agent markets because teams will try to get the best players essentially at any cost necessary.
ReplyDeleteChandler,
ReplyDeleteIn your post you mention that professional athletes are significantly more scarce than CEO's because of the fact that many more people could replace a CEO. Due to the fact that 9 out of 10 sole proprietorships fail I would be willing to say that this is not true. You could argue that outside influences would be the cause for this, people not being in the right area or not knowing their target market, but these are all things that a successful CEO should know. A CEO has to be a leader who is business savvy enough to be able to move his company forward, something that not everybody is able to do.
Although I do not agree with the high salaries of athletes, I have to acknowledge that they are valuable and important to others. People who will take off of work to not miss a game, or paint themselves with the team colors, obviously think highly of those athletes. Considering the amount of money this can create for the city that's hosting a particular game, it makes sense the outrageous salaries athletes receive.
ReplyDeleteChandler, I thought your post was interesting because while I knew of the ongoing debate of whether professional athletes are overpaid or not, I have never really thought of the economics behind it. I liked how you put things into perspective by comparing them to CEOs. Although professional athletes work hard physically, CEOs must work hard to be innovative, efficient, and educated to keep their corporations functioning and thriving. However, there is no denying the great risk of injuries as a professional athlete, the great amount of revenue they bring into cities, and the marginal benefit society gets from watching their favorite athletes perform well.
ReplyDeleteAs I was reading this post, I was taking it as the point of view of a professional athlete. While they do make a large amount pf income, they have worked all their lives to do something that takes a special person to do. The dedication and the willpower and the adversities that the athletes go through to make their dreams and success a reality is something that very few other jobs have to do, so I do in a way think they deserve what they get.
ReplyDeleteWell, they are overpaid, but in no way should they make the same as everyone else. The things athletes do to the economy is amazing, but so do business people and soldiers. A lot of professions can do just as much, but not are as recognized. Also a CEO can't always be replaced easily. Some companies collapse under new CEO's and that destroys whole companies. All in all they should get paid high for the work they do and the limit to how many athletes there are, but just a bit less than where they are now.
ReplyDeleteIts all based on the fact that people watch it and the athletes and organizations can get away with it. The demand for athletes is very inelastic (as nobody wants to see a bad player), so by default limiting supply increases the total revenue, forcing all athletes to be of high quality. Its more of a societal problem than a problem with the companies.
ReplyDeleteThis piece is excellent in applying economic theory to professional sports. Looking at professional athletes through the perspective of their economic value to the city is very creative. My only criticism is that you fail to answer the question you have in your thesis, making you simply restate the question rather than reach any arguable answer.
ReplyDeleteThrough out your piece you really gave insightful information on both sides of this debatable statement. As you said in your piece, even though athletes get paid a lot (and maybe even more than needed), those athletes bring in money for the state. Hundreds to thousands of people come all over to watch their favorite sports team play. After reading this, I am still undecided if athletes get paid too much. On one hand, it brings in some profit for the state, but on the other, it seems unfair to the other business men and women of the world who try just as hard as the athletes.
ReplyDeleteAlthough you propose some very good insight for both sides of the debate, I will always stand on the side that athletes are overpaid. There are much more deserving jobs out there that are so incredibly underpaid. It just doesn’t seem right. An EMT, someone who saves other people’s lives, makes right around $30,000 a year, yet an athlete, who is here strictly for our entertainment, makes millions. Athletes do bring profit to the state, I understand that. It just seems ethically incorrect that these people, who don’t truly contribute anything substantial to the US other than money, have a salary that is so high. Our country really needs to think about the vitality of a job and base the salary off of that, rather than basing it off of how much profit an individual can bring in for our country.
ReplyDeleteI believe that sport players are over paid they play a sport and get paid way to much. They might have harder things to do but people work 40 some hour weeks and they don't get paid close to what those other people make. I believe we work just as hard as those people to make just as much money and they don't get paid close to it. i think sports players are over paid by a lot
ReplyDeleteI think the question of overpaid and underpaid becomes to personal, because a lot of people will pay overpaid because athletes do not perform a function that is essential to the economy. However, since there is a sizable demand for sports and huge companies dedicated to it, athletes are paid because they are low in stock and organizations are very committed to putting together winning teams so that they can maximize revenue. Its not that they work any harder than anyone else, its that the value of their work is very high because so many people are invested in the success of a team.
ReplyDeleteThis was a great topic to discuss supply and demand as well as marginal benefit versus marginal cost. You made it even better by comparing an athlete to a CEO. Just saying that Lebron James makes over $20 million a year does sound ludicrous. But people don't put into consideration how much total revenue he contributes to. Lebron James gets paid a fair amount to what his job asks him to do. Many jobs like CEO just require mental strategy to get the job done. Whereas Lebron James has tochange his eating habits, his physical habits, and incorporate a lot of strategy to perform well. Plus you factor in when a CEO goes to work, he doesn't have millions of eyes on his every move. Lebron James is put under immense stress because he's already held to such high expectations. He has cities counting on him to do his job right.
ReplyDeleteChandler, your post really causes readers to think, to have a small debate in their mind. When individuals think of all the jobs in the world their salaries, the differences between the salaries in different healthcare positions, salaries of models to other desk workers, and the salary of military personnel and the benefits they receive. Your post is a door to a room of financial debates for every occupation. The statistics that you provide are insightful to considering more than just our personal opinions of salaries, but the percentages and differences will open minds as you have proved.
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