The Economic Impact of NBA Superstars: Evidence from Missed Games using Ticket Microdata from a Secondary Marketplace

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Authors

Scott Kaplan
Vaibhav Ramamoorthy
Cheenar Gupte
Amit Sagar
Deepak Premkumar
Joshua Wilbur
David Zilberman

Abstract

Abstract: The NBA is widely regarded as a “superstar-driven league." However, superstars may be forced to miss games due to injury or purposefully “rested” by teams. A superstar's absence has detrimental effects on the quality of games, especially with respect to the fan experience. This paper uses rigorous econometric methods to quantify the per-game value associated with the NBA’s top players by evaluating ticket price changes on a secondary ticket marketplace when such players are announced to miss a game. We collect high temporal frequency microdata from an online secondary ticket marketplace and the exact timing of player absence announcements to determine the reduction in willingness-to-pay associated with a superstar absence for the average NBA game attendee. Our findings suggest that absences of several superstars, including some of the most popular like Stephen Curry, Kyrie Irving, and Anthony Davis, do have a statistically significant and economically meaningful impact ranging from a 7-25% ($9-$25) reduction in the average ticket price for matchups in which they are absent. Over a season, this can lead to millions of dollars in welfare losses. We conduct additional heterogeneity tests, and find that certain players, like Stephen Curry and Kevin Durant, exhibit much larger away game absence effects, while others like Anthony Davis and Kristaps Porzingis experience much larger home game absence effects. Furthermore, the negative impact of a superstar absence is much smaller for games played in larger markets. Our findings have significant ramifications for the NBA and individual franchises, including NBA policies on resting players, the implications of suspensions for welfare of NBA fans, and franchise decision-making about dynamic pricing schemes in the primary marketplace.

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