NBA Salary Cap Research Paper

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In today’s economic system, money has played an enormous role in the National Basketball Association. Over the years, many team owners have debated if the the NBA should have a salary cap. Salary caps exist in most sport leagues and are one of several mechanisms that allow the billionaire team owners to collectively control and suppress the wages of the athletes. The National Basketball Association must continue to have a salary cap for many reasons such as talent distribution and competitive balance, higher attendance and increased revenues, increased competition and media exposure, and wage parity and organizational intelligence. Without a salary cap the NBA will not be maintained and would be a disaster. To better understand my position, …show more content…
Without a salary cap, teams with more money could simply outspend the remaining teams for the better free agents. The basic idea behind a salary cap is that a team can only sign a free agent if its total payroll will not exceed the cap so a team with deep pockets is on a more level playing field with every other team. The actual amount of the salary cap varies from year to year, and is calculated as a percentage of the league's revenue from the previous season. Like many professional sports leagues, the NBA has a salary cap to control costs, defined by the league's collective bargaining agreement (CBA). The type of salary cap the NBA has is known as soft cap. The NBA has a soft cap which allows the salary cap limit to be exceeded. A soft cap like the NBA's contains exceptions which allow teams to sign players or make trades that exceed the cap under certain conditions. Having a soft cap promotes a team's ability to retain its own …show more content…
The salary cap in 1946-47 was $55,000 with an average player earning between $4,000 and $5,000. The NBA continued without a cap until 1984–85. The league brought back the salary cap in an effort to level the playing field among all of the NBA's teams and ensure competitive balance for the league in the future. “Before the cap was reinstated, teams could spend whatever amount of money they wanted on players, but in the first season under the new cap, they were each limited to $3.6 million in total payroll”, states Larry Coon. Under the 2005 CBA, salaries were capped at 57 percent of basketball-related income (BRI) and lasted for six years, until June 30, 2011. The 2011 agreement set the cap at 51.2 percent of BRI in 2011–12, with a 49-to-51 band in subsequent

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