SOCIETÀ ITALIANA DI DIRITTO ED ECONOMIA
Alex Raskolnikov (Columbia University)
Abstract
What is the best way to reduce economic inequality? Economists, lawyers, political philosophers and politicians have pondered this question for decades. Yet there is another group of savvy and highly motivated individuals who have been thinking about redistribution for just as long. Commissioners of the National Football League, the National Basketball Association, the National Hockey League, and Major League Baseball together with team owners and player unions have been inventing and reinventing ways to redistribute resources, and they continue to do so today. The same is true of the President of National Collegiate Athletic Association along with the heads of Big Ten, Big Twelve and other powerful athletic conferences. This Essay asks what can we learn from their experiences.
The answer, it turns out, is that we can learn quite a bit. Key tax policy questions—whether it is better to have one tax base or many, whether non-tax rules should take distributional effects into account, whether it is better to redistribute in cash or in kind, whether redistribution should take place at the national or local level, and whether predistribution is superior to redistribution—all arise in major sports competitions. Running sports tournaments, it turns out, has more than a little in common with running a tax-and-transfer system. And the general approach reflected in the design of real-world tax systems and professional sports tournaments turns out to be the same: adopt many plausible solutions instead of searching for a perfect one.