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The process of wage determination is interplay between the availability of the product that an employee offers and the demand for that product. This therefore means that sometimes, it is not the relative worth of the product offered by a person that determines the amount of reward that he or she receives, but how scarce that product is in comparison to its demand. This scarcity therefore is the major determinant of the wage that an employee is played. An employee whose talent is unique and has little competition from other employees therefore would most likely be paid more because he has a unique talent that the other employees lack, hence justifying the huge pay that the employee wants (Mohanty, ND).
In this light, the wages received by professional teachers and that received by professional athlete cannot be compared. For instance, one sports person can earn an equivalent combined salary of 300 kindergarten teachers. This makes one pose the question whether the value of the teacher in the society is of lesser importance as compared to that of the athletes. Education which is a teacher’s product is arguably and agreeable to everyone that it is a noble service that each one should be able to get. Despite this, teachers still earn little amount of money compared to the professional athletes. This indicates that there is a reason as to why there is this difference between the pay of the teachers and that received by the professional athletes (McLaughlin, 2007).
One of the reason as to why there is this huge disparity between the salaries of teachers and athletes is scarcity of the products they offer. Despite the fact that teachers have a good profession that is valued for its role in the provision of additional worth to the students, they are available in abundance and thus any existing vacancy for an effective teacher can easily be filled by an effective teacher and leave some more who want to fill the same vacancy. Teachers are therefore not scarce despite the fact that they are necessary and their services of great importance. On the other hand, an athlete of good standing is hard to get. There is only one world champion holder which means that whoever attains that title immediately gains a celebrity status. They therefore have an ability to attract massive crowds which means that they increase their productivity hence making their pay to remain high (Chass, 2002).
This phenomenon has been explained by the use of the diamond-water paradox. This paradox holds that water which is an important element for life is an abundant product which makes it a cheap commodity. Its marginal rate of return is low as it is readily available and one can easily get another jar of water at cheap costs. This therefore makes water a cheap commodity. Diamond on the other hand is an expensive commodity despite the fact that it is used for ornamental purposes which means that one can do without them. Despite this, diamond is a scarce product. The little supply available must be competitively be demanded by a huge demand which in turn pushes the price upwards. The price keeps on moving until such a time when the highest bidder is found and the price satisfied the available demand. This therefore makes diamond, a lesser commodity as far as survival is concerned a product that is more expensive compared to water which is a necessity for day to day life. The abundance of water makes it loose an economic value (McLaughlin, 2007).
Due to the high salaries of the athletes, the sporting events have equally gone high. As Abe Polin, cited in class notes (2011) once noted, the high cost of sporting events is making it hard for the fans to enjoy the matches as they please. He asserted that a family of four may find it hard to pay for a live basketball tournament because of the financial responsibility expected from such a family. Since the salaries of the athletes are very high, the cost must be turned to the consumer who happens to be the fun who buys the tickets. Since the event organizers must be able to recoup the cost of paying these athletes, they are left with no option but to charge the ones who come to such sporting events higher. The high pay checks that the athletes collect therefore are to blame for the escalating cost of sporting events. Organizers of such events must ensure that they meet all the cost plus their profitability margins which therefore calls for expensive tickets, a trend that has made the sporting events an expensive undertaking for most of the entrants.
On the other hand however, it has been argued that the high salaries demanded by the athletes do not automatically translate into high prices. This arguments hold demand for tickets as one of the key reason that drives the price of the tickets in a skyrocketing. This school of thought holds that due to the huge demand that the tickets receive the forces of demand and supply pushes the price up until equilibrium is reached. The forces of demand and supply therefore set the prices of the games and not the high salaries that the athletes pocket. This argument has been reinforced by the fact that the athletes acts as a centre of attraction for many sources of revenue and only earn a fraction of all the revenue that they help raise.
By the close of 2010, the highest paid baseball player was Alex Rodriguez who earns an annual income of $33 million per annum. This figure is nearly 100% higher than the highest amount identified by Landsburg (2000) for highest paid baseball player in 2000. Despite the fact that the difference between the years is only ten, the salary of base ball players seem to have doubled as opposed to the salaries of many bother workers. The justification for the increasing pay for this payer is a relative growth to the amount of money they earn or influence the money to be earned. With a growing clientele of those visiting the stadiums for baseball events especially due to the lock and key strategy used by sports organizers who ensure that they encourage the teenager to attend the sports which binds them into the sporting culture. As the years progress, the fan base increases while the title of the best baseball player remains with one holder hence the high rate of remuneration growth for this categories of workers (players) (Carroll, 2010).
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In an open economy where the forces of supply and demand is used to determine various aspects of pricing of necessary commodities, it would be fair if the process of hiring various categories of sportsmen was left without regulations on the hiring processes. Sports are a talent activity where the best performer gets the best prize. Introducing some regulations would mean that the entire sporting activity is controlled by interested parties which may offer unintended protectionism which may lead to unfair discrimination. All the stakeholders that seek to hire sportspersons should focus on the talent of the sportsperson as well as the relative worth that such a client shall add to the company. A player should be recruited because he stands a huge chance of making the entire team win which is a beneficial issue in sporting activities. Due to this conscious awareness of relative worth of a player, the process of hiring sports person is usually controlled by the ability of the sports person. There are no regulations that are needed in this process as this would lessen the independence of the recruitment process which may make the newly selected sports persons to be less effective.