![]() The salary cap is part of the NBA Collective Bargaining Agreement (CBA) between players and owners. It is termed a soft cap in that there are a number of exceptions that allow teams to go over the cap limit without penalty. The NBA salary cap is very flexible, however. This limit is dependent on the NBA’s total income as a league. The NBA has a salary cap that places a limit on the total money that teams can spend on salaries for their players. This study analyzes the statistics that matter when determining how much to pay players. In all 27 players made at least $23 million for the season. In the 2017-18 season Stephen Curry surpassed LeBron James as the highest paid player with Curry receiving $34.7 million and LeBron close behind at $33.3 million (Table 1). The stars in the National Basketball Association (NBA) are paid handsomely. Keywords: National Basketball Association, player pay, salary cap Again, the same variables are statistically significant although the statistics for the stepwise model improve over the original model. In addition, the researchers perform a backward stepwise regression eliminating insignificant independent variables one at a time (least significant each time) until the model includes only significant variables. The researchers find that points, player experience (years in the league), assists, rebounds and fouls are statistically significant factors when it comes to paying NBA players but we also discover that 3-point shots made and Hollinger’s PER are insignificant. This study accounts for the change in the game by not only including significant variables from prior studies but by also incorporating the 3-point shot and the Hollinger player efficiency rating (PER) in analyzing what counts in determining NBA players’ pay. Analytics that first received much attention in baseball with the money ball phenomenon are now in all sports as well. ![]() Teams over the years have gone from seldom shooting the 3-point shot to making it the focus of their offense. Prior studies show that players are paid for points scored, rebounds, experience, assists, blocks, field goal percentage and fouls. In the 2017-18 season Stephen Curry received over $34.7 million and LeBron James made over $33.3 million on the court. William Compton is Professor of Finance in the Cameron School of Business, UNC Wilmington NBA Players’ Pay and Performance: What Counts? Wilmingtomn, NC Sigler is Professor of Finance in the Cameron School of Business, UNC Wilmington Authors: Kevin Sigler and William Compton ![]()
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