Analysis of Italian Serie A Players Salaries in Correlation to their Personal Performance

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Throughout history, men and women have competed against one another in sport and many have enjoyed watching these competitions for entertainment. In early history, most men competed for their lives. However, in modern times, men are paid large salaries to compete in competitions and sports. In the past fifty years, the salaries of athletes in every sport have risen to disproportionate amounts in comparison to the public per capita worldwide. The financial worth of these athletes exceeds the value that any one individuals actually worth.

Athlete salaries in the sporting industry have grown extremely excessive and league officials need to control the outrageous payrolls by using salary caps, negotiations, and legal tactics. Such as the player’s salaries of the NBA, which are determined under the regulations and requirements of the salary caps. However, salary caps are not present in every sport or league for example Italian Serie A. Therefore, what significant variables actually make up a player, in the Italian Serie A’s, yearly salary? The purpose of this analysis is to analyze specific variable, of Italian Serie A’s players, to help the general public understand player’s yearly salaries.

It is now widely recognized that the distribution of pay among athletes in not just a passive economic outcome, but an incentive to encourage performance that will positively impact revenue from fan sales. However, since salaries of athletes have grown drastically over the years, leagues are requiring salary caps to minimize outrageous salaries. One reason for the introduction of salary caps is to regulate fairness with in leagues. A high performing athlete brings in great amounts of fans and with the fans comes increased yearly revenue for the clubs. This should not be an issue although, this creates unfair advantages. Clubs with high performing athletes and great amounts of yearly revenues drives the prices of players higher than they should. So, the teams with money to spend will outbid small market teams and give in to high salary requests. However, are there any positives that come with higher pay?

Some would agree that yes, there are positive outcomes of paying athletes large salaries each year. This is because more financial resources often lead to better athletic performance. The motivation to increase yearly salaries helps motivate athletes to do their best each game, match or competition. Also money brings about the motivations to perform to the best of their ability to have other large market team’s outbid teams in their honor. With the ability to request a high salary because of performance why wouldn’t athletes’ push for self greatness. From a clubs view point, offering higher pay can be used to lure better players from other teams and improve the clubs overall record. Also, with the addition of high performing athletes to a team, for a large yearly salary, might encourage the other athletes to work harder which improves clubs performance.

However, negatives surface because of high salaries. First, salary caps are being requested in certain leagues since high salaries are increasing clubs debts. With large market clubs having the advantage to outbid smaller markets introduces the issue of desperation. Therefore, small market clubs and teams are paying high salaries for their athletes even though they might not be able to afford it. “We are paying players to produce debts. Are we crazy?” states Claudio Lotito – Lazio’s president. The second negative consequence of high salaries for certain athletes in clubs is tension. Pay inequality creates tensions among team members, resulting in performance of the team as a whole to suffer.

Whether high salaries for athletes affects performance positively or negatively is one thing however, how the salaries of athletes are determined is the real question. What does an athlete have to do during a season in order to have an increased salary going into the next season? These are questions which motivate my desire to study professional Italian Serie A athlete’s salaries.

The purpose of this study is to test different explanatory variables on the dependent variable, individual athlete’s salaries. Specifically, how significant are the variables: amount of games started, goals scored, position on field, club attendance, percent of games won and age, when determining athletes salaries.

For this study 57 randomly chosen, Italian Serie A, professional soccer players were analyzed. This study tests the effects of certain variables from the 2006-2007 season on these individuals 2007-2008 salaries. If a strong correlation exists between any of the chosen variables and salaries than it will be concluded club management focuses closely at variables of that nature when choosing their athletes yearly salaries.

The data for this study regarding player’s salaries for the 2007/2008 season were pulled from the Calcio Serie A’s salaries database. There were only 57 athlete’s salaries of the 2007/2008 season, open to public viewing, which played during the 2006/2007 season for the Italian Serie A league. With the salary information of the 57 players I was then able to search each individual’s 2006/2007 seasons statistics on the Italian Serie A leagues website.

The dependent variable for the regression is the natural log of the total salary of each of the 57 players for the 2007/2008 season. The salaries are presented in Euros. As for the explanatory variables there were seven which, after research, would possibly positively increase salaries of athletes. These seven variables consisted of: number of games individual started during the season, number of goals individual scored during the season, number of assists individual made during the season, number of fouls individual committed during the season, total club attendance during the season, percent of games clubs won during the season (out of 38 games) and age of individuals during the season. There also were 3 dummy variables added to the regression which consisted of: individual’s position as defender during the season, individual’s position as midfielder during the season and individual’s position as striker during the season.

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