How Race Impacts the Market for Baseball Cards Across Time Nancy J. Burnett Lee Van Scyoc Wisconsin Economics Association Dec. 3, 2010

Been There: Some Past Literature Andersen, Torben and Sumner LaCroix, “Customer Racial Discrimination in Major League Baseball” Economic Inquiry, 29(4), October, 1991,pp Fort, Rodney and Andrew Gill. “Race and Ethnicity Assessment in Baseball Card Markets” Journal of Sports Economics, vol. 1(1), February 2000, pp Gabriel, Paul E., Curtis Johnson, and Timothy J. Stanton. “An Examination of Customer Racial Discrimination in the Market for Baseball Memorabilia.” Journal of Business, vol. 68, April 1995, pp Jewell, R. Todd, R. Brown, and S. Miles “ Measuring Discrimination in Major League Baseball: Evidence from the Baseball Hall of Fame.” Applied Economics, 34(2), Jan. 2002, pp Kahn, Lawrence M., "Discrimination in Professional Sports: A Survey of the Literature." Industrial and Labor Relations Review, vol. 44, April 1991, pp McGarrity, Joseph, Harvey D. Palmer, and Marc Poitras., “Consumer Racial Discrimination: A Reassessment of the Market for Baseball Cards.” Journal of Labor Research, vol. 20(2), Spring, 1999, pp Nardinelli, Clark, and Curtis Simon. "Customer Racial Discrimination in the Market for Memorabilia: The Case of Baseball." Quarterly Journal of Economics, vol. 105, August 1990, pp Tregarthen, Timothy, "Do Fans Discriminate in the Market for Baseball Cards?" The Margin, vol. 7, Summer 1992, pg. 48.

Our Data: Baseball Cards Players vs. Pitchers Two Time Periods, Three Price Points (1981, 2000 and current) Much larger than other authors ◦2770 player cards (not pitchers) from 1960’s ◦373 player cards from 1986

Summary Stats: 1960’s VariableMeanStd. Dev.Min.Max Price Price Price White Exp (Experience) Age Rookie PAB (Percentage at Bat) LHR (Lifetime Home Run) LAVE (Lifetime Average) LSLG (Lifetime Slugging) AS (All Star) HF (Hall of Fame) MVP (Most Valuable Player) WS (World Series)

Race and Price… however…

Non-Whites Play Better…. VariableWhitesNon-Whites Price Rookie Lifetime Slugging Percent at Bats Lifetime Home Runs Lifetime Average LSLGRES AGERES World Series MVP Hall of Fame All Star Count

Our Model Starting with Fort and Gill (2000): Left Censored Tobit Traditional Variables: Rookie, at Bats, Lifetime Slugging, Lifetime Home Runs, Lifetime Average, Age Experience, RACE Residuals for ‘unexpected’ performance Slugging/Batting Residual = ◦Negative numbers imply “greater power” Age/Experience Residual= ◦Negative implies brought up earlier than expected Fame (MVP, All Star, Hall of Fame, World Series)

Dependent Variable:Y=Price 1981Y=Price 2008 Without FameWith FameWithout FameWith Fame Constant (1.23) (0.86) (-1.58) (-2.88) White (1.81) (1.84) (3.21) (3.65) Rookie (0.40) (0.25) (2.49) (2.12) PAB (Percent at Bat) (-0.96) (-1.24) (-2.88) (-2.89) LSLG (Lifetime Slugging) (-1.52) (-0.88) (0.92) (2.7) LHR (Lifetime Home Runs) (6.4) (2.46) (14.69) (4.52) AgeRes (-1.92) (-2.11) (1.49) (0.72) LSLGRes (1.48) (0.93) (4.34) (3.15) AS (All Star) (2.23) (2.73) HF (Hall of Fame) (4.5) (14.56) MVP (Most Valuable Player) (0.51) (4.85) WS (World Series) (0.84) (6.75) n2770 Log Likelihood Pseudo R Number of Left Censored Observations 335 ($0.13) 335 ($0.13) 137 ($1.5) 137 ($1.5)

Trend Effects Race Time Interactive (white*Year) – does discrimination appear to change over time? The true coefficient on white will depend upon both coefficients: Break-even when the coefficient =0

Dependent Variable:Y=Price 1981Y=Price 2008 Without FameWith FameWithout FameWith Fame Constant (8.67) (8.49) (4.98) (4.65) White (-2.88) (-2.91) (-.47) (-.81) Year (-8.66) (-8.48) (-4.98) (-4.66) Year*White (2.88) (2.91) (.47) (.81) Rookie (.56) (.41) (2.67) (2.27) PAB (Percent at Bat) (-.45) (-.60) (-2.48) (-2.46) LSLG (Lifetime Slugging) (-3.10) (-2.46) (-.31) (1.59) LHR (Lifetime Home Runs) (6.75) (3.12) (15.10) (5.03) AgeRes (-.44) (-.68) (2.60) (1.70) LSLGRes (.88) (.47) (3.89) (2.84) AS (All Star) (1.47) (2.28) HF (Hall of Fame) (4.09) (14.31) MVP (Most Valuable Player) (.63) (4.87) WS (World Series) (.41) (6.51) n2770 Log Likelihood Pseudo R Number of Left Censored Observations 335 ($0.13) 335 ($0.13) 137 ($1.5) 137 ($1.5)

Trend Results For Price 1981,, a combined coefficient on white of [ *year], which would suggest that partway through 1964 the break-even point would be reached (“novelty effect”) For Price 2008 we see an earlier break- even, in the mid 1950’s (no significance)

Further Evidence? Explore more recent data: 1986 cards (373 distinct cards) VariableMeanStd. Dev.Min.Max Price White Exp (Experience) Age Rookie PAB (Percentage at Bat) LHR (Lifetime Home Run) LAVE (Lifetime Average) LSLG (Lifetime Slugging) AS (All Star) HF (Hall of Fame) MVP (Most Valuable Player) WS (World Series)

1986 Price2000=y1986 Without FameWith Fame Constant (-1.9) (-2.05) White (1.17) (.95) Rookie (4.54) (4.55) PAB (Percent at Bat) (1.28) (1.55) LSLG (Lifetime Slugging) (.04) (0.28) LHR (Lifetime Home Runs) (5.15) (4.00) AgeRes (2.84) (3.17) LSLGRes (6.01) (5.38) AS (All Star) (-.86) HF (Hall of Fame) (1.42) MVP (Most Valuable Player) (1.76) WS (World Series) (-.03) n373 Log Likelihood Pseudo R Number of Left Censored Observations 258 ($0.1) 258 ($0.1)

Conclusions? Taking out the ‘novelty’ affects of race, by looking across time from a period near integration and then again more recent data Taking out the skill and fame differentials across race Still a persistent hint of discrimination – white player cards are valued higher…?