The Economic History of MLB and Player Contracts
Date of Award
2025
Document Type
Thesis
Degree Name
Bachelors
Department
Social Sciences
First Advisor
Yu, Sherry
Area of Concentration
Business Economics
Abstract
How have player contract innovations and media-driven revenue streams transformed the economic structure and franchise valuations of Major League Baseball from 1876 to the present? This thesis explores the transformation of Major League Baseball’s (MLB) economic landscape from its founding in 1876 to the present, with a focus on the evolution of player contracts and media-driven revenue. It examines how MLB transitioned from a gate-revenue-dependent league to a multi-billion-dollar industry fueled by free agency, salary arbitration, franchise relocations, and national and local television rights. Using historical data, case studies, and financial analysis, the study investigates key inflection points including the elimination of the reserve clause, the rise of broadcast media, and the emergence of mega-contracts and their impact on franchise valuation and labor dynamics. The work also contrasts MLB's financial model with other major sports leagues and identifies how modern player contracts function as strategic financial instruments tied to branding, media exposure, and international market expansion. This analysis reveals how economic innovation and market inequality have shaped MLB’s structure and profitability, and highlights the dual nature of modern contracts as both competitive tools and economic assets.
Recommended Citation
Rivera-Calderon, Fernando, "The Economic History of MLB and Player Contracts" (2025). Theses & ETDs. 6744.
https://digitalcommons.ncf.edu/theses_etds/6744