•  
  •  

UKnowledge > Office of the Vice President for Research > Office of Undergraduate Research > Kaleidoscope > Vol. 6 (2007)

 

Abstract

Minor League Baseball is a half-billion dollar a year industry in the United States. It has grown to its current state under an umbrella of protection from U.S. antitrust statutes. Beginning with the Federal Baseball decision in 1922, the Supreme Court has consistently ruled that professional baseball is exempt from both the Sherman and Clayton Acts— the seminal federal government statutes regarding antitrust. This status is unique; no other professional sport enjoys such immunity. If the exemption were lost, the effects on this staple of American culture would likely be extremely disruptive. Throughout this project, I analyzed the effects that a change in the application of federal antitrust law would have on two aspects of the game: 1) the player development agreements between the major league franchises and their minor league affiliates, and 2) the standard player contracts signed by every minor league player, which bind them to the team that drafted them until well after they make it to the major leagues. After finding that a change in the way the courts interpret past decisions would prevent both of these aspects from operating the way they have in the past due to concerns over their anticompetitive effects, I consider the likelihood that these changes would actually be made. The court system’s reluctance to violate precedent; the effect of the antitrust “rule of reason,” which allows for some anticompetitive activity provided that the actions yield even greater “pro-competitive benefits;” and the antitrust exemptions provided specifically for labor agreements arranged through collective bargaining are all considered during the process of finding that Minor League Baseball is most likely secure in its desire to remain unimpacted by federal antitrust law. While previous discussions have focused solely on the major leagues, this study builds on their work to look at the effects the antitrust laws have on the minor league game.

Download

Share

COinS