Microeconomics Case Please view attached docs included works cited page end paper. Title paper Microeconomics Case

Microeconomics case assignment 3: Why are athletes' salaries so high?

Perhaps the most obvious reason for the stratospheric nature of athletes' salaries is the unique talents that athletes possess. A doctor, nurse, or teacher may perform far more vital functions for society. But even in such competitive white-collar professions, few doctors and teachers are irreplaceable. Professional elite athletes possess very specialized skills and talents so they can command absurdly high salaries. Wages in any labor market are determined by the laws of supply and demand, not social justice. In a command economy, the state could determine that a firefighter should earn more than an athlete, but not in a capitalist system. The benefits a teacher provides a student, while considerable, are often only manifest in economic terms after many years. In contrast, a baseball player quickly earns his or her franchise money through selling paraphernalia with his name on it, promoting the sales of season tickets, and generating advertising revenue. "When people start paying to watch teachers teach…their salaries will get closer to what players make" (Chass 2002).

Doctors, nurses, teachers, and firefighters may be as necessary as water. However, much like water, because they are seen as common, they command a lower price than the diamonds of the labor market -- the athletes. It could also be added that because athletes participate in spectator sports, they are seen as more valuable. Diamonds are beautiful to gaze at, but water is only valued when it...

The economic law of marginal productivity also means that the value of teachers will be lower than the value assigned to athletes: "When some item is widely available in abundance, such as water in most inhabited areas, the next unit acquired will be relatively inexpensive, the value applied to it by users will be low. If you don't take one gallon now, there will always be more where that came from" (McLaughlin 2007).
The fierce competition amongst professional athletes forces them to train hard, with focused determination, to secure places in the few, remaining openings that exist for them within the sport. "Lives are saved and enriched by the world's thousandth-best doctor and thousandth-best teacher. But there is no place in professional baseball for the world's thousandth-best shortstop. A successful doctor doesn't push other doctors out of the profession; a successful shortstop renders some other shortstop unnecessary" (Landsburg 2000). The make-or-break nature of sports, which demands years of preparation and many hours of practice a day means that it is not worthwhile to expend such effort unless the chance of a payoff is very great, given that a prospective athlete may gain nothing in his or her gamble to be the best.

Why are owners willing to pay athletes so much? There is a clear relationship between a player's ability to win and his ability to draw crowds to the ballpark. To make adequate revenue from selling tickets,…