The Spatial Impact of Peers in the Workforce: A Spatial Econometric Approach with an Application to Major League Baseball

Abstract

Past studies have used the world of Major League Baseball as a lens to investigate the concept of shirking. In particular, there has been an emphasis on looking at the incentive for baseball players to shirk once they have obtained job security through long-term contracts. However, the literature has neglected to consider the impact of the spatial effects across a team’s players. Players may have incentive to shirk or not based on the performance of teammates directly around them. This study utilizes a spatial econometric model to account for the level of work ethic derived from surrounding peers. Similar analysis of spatial peer effects may be fruitfully applied to labor forces outside the world of sports.

Keywords: baseball, spatial econometric models, shirking, labor effort, peer effects

JEL Classification: J41, J44, L83