What is a Blue Chip Recruit Worth? Estimating the Marginal Revenue Product of College Football Quarterbacks

Abstract

The National Collegiate Athletic Association has faced growing scrutiny due to the perceived disparity between the compensation athletes receive and their contribution to athletic revenue. Our novel use of college football game–level statistics shows a gap of millions of dollars between compensation and marginal revenue product (MRP) for elite quarterbacks, consistent with previous studies. Professional sports typically weight pay toward ex ante expected value of performance rather than incentives that pay ex post of performance. Using high school prospect rankings, we show ex ante estimates of elite quarterback expected MRP are substantially lower, roughly US$400,000, and have limited statistical significance with respect to winning or revenue. Our ex ante measurements suggest that expected player value may be closer to the value of scholarships than previous research suggests due to the difficulty in predicting which high school quarterbacks will excel in college.