Abstract

The National Basketball Association is in the market of maximizing profits and minimizing costs. This study aims to determine one aspect of NBA profits. The research presented in this study will test how Superstars affect revenues in the NBA, using a measure of attendance. Formed through a review of previous literature, the null hypothesis states that an increase in Superstars will not cause an increase in attendance. A micro-founded theoretical framework is created to reject this null hypothesis. Four teams from the National Basketball Association were chosen at random, and observed over three seasons. Using this panel data, a fixed effects regression model is formed to test this hypothesis. After correcting for heteroskedasticity the empirical results allowed this study to accept the null hypothesis and conclude that an increase in Superstars will not increase revenues in the National Basketball Association.

Advisor

Mellizo, Phillip

Department

Business Economics

Publication Date

2011

Degree Granted

Bachelor of Arts

Document Type

Senior Independent Study Thesis

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© Copyright 2011 Zannah Stoermer