Re finements to the MLB-NPB Posting System: A Clear Win for Japanese Players and Loss for Japanese Teams, Journal of Sports Economics
We theoretically and experimentally analyze recent changes in the posting system used by Japans Nippon Professional Baseball organization and the United StatesMajor League Baseball organization to transfer the rights of NPB players from NPB teams to MLB teams. Under the old system - a sequential, rst-price sealed-bid auction among MLB teams for player negotiation exclusivity rights the NPB team enjoyed considerable surplus from lucrative posting fees. We predict that the revised system an English auction with an entry fee will transfer most of the NPBs middleman bene fits (posting fees) to the players through higher salaries. Additionally, we analyze a third, proposed but not adopted, mechanism a weighted-average sealed-bid auction. Our experimental results con rm our theoretical predictions. Furthermore, under the new system: efficiency is greatest, MLB teams spend less on Japanese players, and the players' salaries increase signi cantly.
Dale, Donald. 2015. Re finements to the MLB-NPB Posting System: A Clear Win for Japanese Players and Loss for Japanese Teams. Journal of Sports Economics.