In American Sport in the 21st Century on October
16th and the 21st we learned about sports and the
economy. The question that we were
aiming towards answering was, “who benefits economically from sports?” We came to the conclusion that athletes are
the biggest benefactors. First, athletes
benefit the most from salaries, endorsements, and appearance fees. All these fees and payments fall under what
is called a salary cap. A salary cap is
the limit a team can spend on players’ salaries (per player/ per team). In an article written by Chris Bernucca about
the 2014-2015 National Basketball League’s salary caps, he explains that the
overall cap will be $63.065 million.
This number is a 7.5% increase since last year. With this increase, teams may now add another
player to their team without struggle.
Clearly that increase, will highly benefit the players. Next, we learned that there are luxury
taxes. A luxury tax is the amount levied
by the league on teams that exceed the cap.
Bernucca explained that this year, the NBA’s luxury tax threshold is
$76.829 million. This is a 7.1% increase
since last year. This shows that teams
are willing to spend more money to ensure that they will sign a worthy player
on their team. This will benefit both
the organization and the athlete.
Third, we learned what a salary floor is and how it has affected the
teams spending. A salary floor is the
minimum amount that must be spent on the team as a whole. Again, in the article Bernucca tells us the
numbers. The salary floor for the NBA
2014-2015 season is $56.759. This number
is for the entire NBA. The number will
then be divided within each team in the organization. Just from these numbers we can see that both
the athletes and the organizations benefit from sports. The NBA especially has very large numbers
that are tossed around during the season to benefit their teams and secure the
best players economically.
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