A crazy plan to pay NCAA players fairly, that just might work

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Andrew Wiggins and Joel Embiid of the University of Kansas are the two top picks for the 2014 NBA draft. If they actually make the top five — a likely possibility — they will get somewhere around $3 million each to play basketball.

That’s quite an income jump.

Student-athletes receive about $120,000 (2011 dollars) in value a year, things like scholarships, healthcare, coaching, publicity and media exposure, according to David Berri of The Atlantic.  But that may be way off since they do not receive the “hard dollars” of an actual salary, so Berri treats it as a high-end estimate of what Wiggins and Embiid receive.

So what are these two players worth to the team?

Economist Gerald Scully devised a simple system back in 1974 to measure an athlete’s economic impact on a team.

To start, Scully determines the revenue each win is worth to the organization. Next, he calculates the number of wins attributed to each player. Multiplying the two figures, Scully could provide an estimate of a player’s value to his team (employer).

For example, up to the NCAA Men’s Basketball Tournament, Embiid produced 4.67 wins for the University of Kansas Jayhawks — applying the same metrics the NBA uses. As a baseline, Berri writes, economist Robert Brown used U.S. Department of Education college revenue data, which gave him a number of $159,601 for each Kansas men’s basketball victory in 2010-2011.

With that data, Embiid would be worth around $777,286 (prior to the NCAA tournament).

In conclusion, Kansas underpaid Embiid by about $650,000.

Extrapolating the numbers for every member of the Jayhawks — Wiggins (thought to be No. 1 NBA draft pick) is actually the fourth most valuable team member and underpaid by a little over $450K. The list is Embiid, Perry Ellis, Naadir Tharpe, and then Wiggins.

When hiring talent on the free market, underpaying employees is not a smart move for any organization. If there is any individual producing $700K for a business and is paid less than $200K, a rival company would be happy to pay them more.

Not in the NCAA, as current rules prohibit paying players more money. In fact, if caught paying a student-athlete, a school could be banned from competing — bringing the revenue stream down to zero. It is certainly not in the college’s best interest to pay players more money.

One solution would be for schools to establish a “professional NCAA,” by a number of schools breaking from the current system. Then colleges could both pay student-athletes (i.e. employees) more money, and have other teams to play — as well as able to generate revenue.

The result: better players would flock to this “professional” college league (who wouldn’t like the opportunity to make more money?); and schools would be immune from anti-trust laws. The NCAA is facing several lawsuits, and if the courts decide student-athletes are actually employees, payment restrictions would be considered violations of employment laws. A professional league could have collective bargaining through employee representatives, thereby making restricted pay legal.

A professional NCAA would also be able to maintain current fan bases, and not lose players early to the NBA.

Losers in the deal would be colleges and coaches; with players paid more, coaches and administrators would be paid less than they are now. Networks would also see $10.8 billion dollars in contracts with the NCAA lose value — a professional NCAA would be a much more attractive draw for TV viewers and sports fans. The current TV deals with the NCAA are with the “amateur” league, which would struggle to compete for viewers with the professional NCAA.

But all it would take to get the ball rolling, writes Berri, is a few “rogue” schools fighting the status quo.

Phil Ammann is a St. Petersburg-based journalist and blogger. With more than three decades of writing, editing and management experience, Phil produced material for both print and online, in addition to founding HRNewsDaily.com. His broad range includes covering news, local government and culture reviews for Patch.com, technical articles and profiles for BetterRVing Magazine and advice columns for a metaphysical website, among others. Phil has served as a contributor and production manager for SaintPetersBlog since 2013. He lives in St. Pete with his wife, visual artist Margaret Juul and can be reached at phil@floridapolitics.com and on Twitter @PhilAmmann.