Rules Gone Wild: Part II (by Dwayne Barney and Paul Cleveland)

 

helmetAthletics departments are devoting ever more resources to insure that the NCAA’s rules are being enforced, but judging from the number of NCAA investigations and sanctions the institutions’ efforts are largely futile. Given the impossibility of monitoring everything, most institutions walk a tenuous path hoping to avoid investigation. Moreover, in a world where everyone is guilty, competitors can attempt to prompt NCAA investigations in order to gain a competitive advantage.

The Association has so many bylaws that the thought of an investigation strikes fear into administrators.  Given that membership is entirely voluntary, how can this happen?  What is it that induces universities to voluntarily participate in an arrangement that many find to be burdensome?  The economic theory of rent seeking provides some insight into the matter.

The cash generated by intercollegiate athletics in general, and college football in particular, is enormous. An appearance in a Bowl Championship Series (BCS) game is highly coveted, since the payoff from these games result in millions of extra dollars of revenue for the universities involved. Likewise, an appearance in the NCAA’s final four in basketball generates huge sums of cash for the participating institutions.

Besides the direct cash payments to the universities, indirect benefits take the form of increased sales of season tickets, concessions, and merchandise with school logos. Given the large amount of money on the line, the competition between universities for the best student-athletes is intense.  

In a recent column on academic pretense, Thomas Sowell pointed out the “hypocrisy” of academicians and school administrators who are vehemently opposed to paying student-athletes.(See the article titled “Academic Hypocrisy” at http://townhall.com/columnists/thomassowell/2012/02/21/academic_hypocrisy/page/full/). 

Head football coaches at major colleges normally receive annual salaries well in excess of a million dollars. Assistant coaches are also handsomely rewarded, as are athletic directors. But student-athletes are not allowed to share in the windfall arising from their work on the field.  For the guys on the field, even a booster-bought snow cone is prohibited. In commenting on the various recruiting and other NCAA violations being reported, Taylor Branch (2011, p. 1) observed that, “the real scandal is the very structure of college sports, wherein student-athletes generate billions of dollars for universities and private companies while earning nothing for themselves.”1

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