HCBE Faculty Articles
Title
Human Capital Valuation in Professional Sport
Document Type
Article
Publication Date
2013
Publication Title
International Journal of Business, Humanities and Technology
Volume
3
Issue/Number
3
First Page
12
Last Page
21
Abstract/Excerpt
This paper is based on the premise that in professional sport, team earnings are driven by the performance of the individual athlete. It follows that the expected realizable value of each athlete must be accurately estimated in order to obtain a realistic estimation of team earnings. This paper undertakes such as assessment by measuring individual contribution to team revenue. For the superstar, revenue growth is modeled by a combination of an exponential growth model and a path based on a Brownian motion. The slow-growth performer’s revenue growth is represented by an exponential growth model and two Brownian motions to account for increasing and declining revenue growth. The injured player’s revenue growth is approximated by an early period of either superstar performance or slow-growth performance, followed by a Poisson distribution with discontinuities to account for periods of absence due to injury.
NSUWorks Citation
Harris, Judith; Abraham, Rebecca; and Auerbach, Joel, "Human Capital Valuation in Professional Sport" (2013). HCBE Faculty Articles. 751.
https://nsuworks.nova.edu/hcbe_facarticles/751
