Baseball Salaries

in 1976 (Fisher & Heller, 2001, par. 4).
             Baseball was the first sport to have free agency, and as it currently stands, the last to control it. All other major sports, basketball, football, and hockey, have plans in place in order to keep a check on salaries. As a result, they are not facing the crisis that Major League Baseball will soon have to deal with. These sports all have a form of a salary cap or some revenue sharing between the small and large market teams. Baseball's one attempt at this, a luxury tax for teams with high payrolls, has done nothing to curb the extreme growth of salaries.
             It is also interesting to examine the roots of free agency, which in the beginning was a good idea. In December 1975, Peter Seitz, at the time baseball's arbitrator supported a grievance that two players had filed (Chass, 2000, par. 4). He ruled that when a player's contract to a team expired, the player was free to choose from all interested teams. In theory, this is a good idea that is fair for players. They weren't property of their original teams after contracts expired and were free to pursue other options, just as in the same way a businessman could look for a new job. However, there was no system in place to stop a bidding war between teams if the money was available. It also failed to take in to account the human ego. If a player sees a person with similar statistics getting paid more, then that player will demand the same amount of money, and this cycle continues endlessly.
             Salary arbitration is another cause of the salary inflation, which on average has resulted in a 100% increase of the average salary in recent years (Chass, 2001, par. 18). In short, salary arbitration occurs when a player and a team renegotiate the contract with a neutral third party officiating. If a player has a good season, and feels that he is getting underpaid, he can file for arbitration. Players win most of these ca...

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