The decision by prospective NBA players to bypass collegiate play and enter the NBA Draft was always highly controversial. Indeed, even the U.S. Supreme Court joined the controversy in 1971, with its ruling in Haywood v. National Basketball Association striking an NBA requirement that players delay entry into the NBA for four years after high school graduation. The Supreme Court’s decision in the case allowed for a de facto prep-to-pro pipeline, provided high school stars could establish evidence of financial hardship. However, roughly 35 years later, in 2005, the prep-to-pro pipeline was closed when the NBA and its players union negotiated a new collective bargaining agreement that established the minimum age of 19 for all players entering the league, while non-international players were also required to spend at least one year post-high school graduation before being eligible for the NBA Draft. This meant that effectively all potential prep-to-pro caliber U.S. high school stars would compete collegiately for one season. This led to popular use of the phrase “one-and-done” by basketball coaches, players and fans as a replacement for the outdated “prep-to-pro” mantra.
Given their precocity, one would expect that college basketball coaches would covet the services of one-and-done prospects. Studies of the experiences and university choices of one-and-done recruits have also been lacking in the behavioral economics literature. A new study by Turner College economics professor Frank Mixon and his colleagues, Steven Caudill of Florida Atlantic University and Richard Cebula of the University of Tennessee, fills that void by investigating the university and coach-related factors that lead to successful recruiting on one-and-done talent. Mixon and co-investigators examine data over the life of the one-and-done stipulation in the NBA’s collective bargaining agreement for all “power five” conferences in the NCAA. This process produced a panel dataset with 1,105 observations. Probit models presented by Mixon et al. reveal that having a head coach who has previously taken a team to either the NCAA Tournament Final 4 or won an NCAA Championship significantly increases an institution’s probability of attracting one-and-done talent in the current year. Other results indicate that one-and-done prospects place a premium on player development. For example, the cumulative number of NBA draftees produced by a university positively and significantly impacts the university’s probability of signing a one-and-done player in a given year. Additionally, having a coach who has previously served as a head coach in the NBA significantly increases the probability that a university will land a one-and-done recruit in a given year.
These and other findings presented by Mixon and his colleagues have implications regarding the economic rents generated by one-and-done players in men’s college basketball. A recent study suggests that NBA-bound collegiate basketball players generate, on average, about $400,000 in annual rents for the institutions they represent, while the top players among this group are associated with up to $1.8 million in annual rents. Another indication of the potential size of the economic rents generated by one-and-done players in men’s college basketball is provided by the NBA salaries that are obtainable following a successful one-and-done stint in college (e.g., as a lottery pick or first round draftee into the NBA). In this regard, Mixon’s study points out the first round of the 2022 NBA Draft included 12 one-and-done draftees and 18 more traditional draftees. Interestingly, the 2022 NBA Draft contracts for the 12 first-round one-and-done draftees ranged from $11.3 million to $50.2 million, while those for the 18 other draftees ranged from $11.5 million to $36.4 million. The mean contract for the 12 one-and-done draftees was $23.6 million, while that for the 18 other draftees was $19.3 million. Lastly, although the college basketball stars who assist in the creation of the types of rent discussed above have not historically shared in that rent creation, their coaches have benefitted from such windfalls. Based on the results presented in Mixon’s study, coaches with prior NBA head coaching experience are contributing to both human capital formation and player rent-seeking through access to the coaches’ NBA networks. As the study reports, although the collegiate head coaches who had prior NBA head coaching experience constituted only 7.7 percent of our sample of coaches for the 2017-2018 season, they represented 26.7 percent (31.3 percent) of the 15 (16) highest-paid coaches in the sample for that same season.
Given their precocity, one would expect that college basketball coaches would covet the services of one-and-done prospects. Studies of the experiences and university choices of one-and-done recruits have also been lacking in the behavioral economics literature. A new study by Turner College economics professor Frank Mixon and his colleagues, Steven Caudill of Florida Atlantic University and Richard Cebula of the University of Tennessee, fills that void by investigating the university and coach-related factors that lead to successful recruiting on one-and-done talent. Mixon and co-investigators examine data over the life of the one-and-done stipulation in the NBA’s collective bargaining agreement for all “power five” conferences in the NCAA. This process produced a panel dataset with 1,105 observations. Probit models presented by Mixon et al. reveal that having a head coach who has previously taken a team to either the NCAA Tournament Final 4 or won an NCAA Championship significantly increases an institution’s probability of attracting one-and-done talent in the current year. Other results indicate that one-and-done prospects place a premium on player development. For example, the cumulative number of NBA draftees produced by a university positively and significantly impacts the university’s probability of signing a one-and-done player in a given year. Additionally, having a coach who has previously served as a head coach in the NBA significantly increases the probability that a university will land a one-and-done recruit in a given year.
These and other findings presented by Mixon and his colleagues have implications regarding the economic rents generated by one-and-done players in men’s college basketball. A recent study suggests that NBA-bound collegiate basketball players generate, on average, about $400,000 in annual rents for the institutions they represent, while the top players among this group are associated with up to $1.8 million in annual rents. Another indication of the potential size of the economic rents generated by one-and-done players in men’s college basketball is provided by the NBA salaries that are obtainable following a successful one-and-done stint in college (e.g., as a lottery pick or first round draftee into the NBA). In this regard, Mixon’s study points out the first round of the 2022 NBA Draft included 12 one-and-done draftees and 18 more traditional draftees. Interestingly, the 2022 NBA Draft contracts for the 12 first-round one-and-done draftees ranged from $11.3 million to $50.2 million, while those for the 18 other draftees ranged from $11.5 million to $36.4 million. The mean contract for the 12 one-and-done draftees was $23.6 million, while that for the 18 other draftees was $19.3 million. Lastly, although the college basketball stars who assist in the creation of the types of rent discussed above have not historically shared in that rent creation, their coaches have benefitted from such windfalls. Based on the results presented in Mixon’s study, coaches with prior NBA head coaching experience are contributing to both human capital formation and player rent-seeking through access to the coaches’ NBA networks. As the study reports, although the collegiate head coaches who had prior NBA head coaching experience constituted only 7.7 percent of our sample of coaches for the 2017-2018 season, they represented 26.7 percent (31.3 percent) of the 15 (16) highest-paid coaches in the sample for that same season.
Mixon’s study is set to appear in a future issue of American Behaviorial Scientist, which is published by SAGE. For over 50 years, American Behavioral Scientist has been a valuable source of information for scholars, researchers, professionals, and students, providing in-depth perspectives on intriguing contemporary topics throughout the social and behavioral sciences. Each issue offers comprehensive analysis of a single topic, examining such important and diverse arenas as sociology, international and U.S. politics, behavioral sciences, communication and media, economics, education, ethnic and racial studies, terrorism, and public service. The journal’s interdisciplinary approach stimulates creativity and occasionally controversy within the emerging frontiers of the social sciences, exploring the critical issues that affect our world and challenge our thinking.
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