Wednesday, November 14, 2007

Why Baseball Players Might Be Underpaid

clipped from
First, a dollar just isn’t what it used to be. When Mr. Rodriguez signed his previous 10-year, $252 million contract in December 2000, the Federal Reserve’s index of the dollar’s value relative to other currencies was over 105. Now it’s barely over 71. I
The dollar’s decline on the currency markets has been more dramatic than overall inflation, but that, too, eats into the value of the greenback. A lump sum of $252 million in 2000 is equivalent to $305.1 million today, according to the Bureau of Labor Statistics’ inflation calculator.
In 2001, the first year of the first Rodriguez mega-contract, major-league players were getting 56% of their sport’s $3.5 billion in revenues.
Yet this year, Jeff Passan notes on Yahoo Sports, players made only about 41% of baseball’s $6 billion in revenue.
What do you think? Are baseball players overpaid or underpaid?
Should more dollar figures in the media be adjusted for inflation?
How much does the weak dollar affect the true value of salaries?
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