We received so many comments and emails about our blog on NFL Sports Incentives a few weeks ago that we decided to follow-up by looking at how Auburn U. head football coach Gene Chizik did after leading his team to a BCS National Championship. Auburn, which finished the season 14-0 knocked off the #2 U. of Oregon team on Jan. 10, 22-19 ( just in case you
were one of the few people in the country not watching the game).
It turns out Chizik did quite well. In addition to his $2.1 million base salary (which, sadly, is less than 6 other coaches in the SEC, but more than I made in my whole academic career), he had already earned an extra $500,000 for hitting 4 of his incentive targets: 13 wins, an SEC title, SEC Coach of the Year, and a BCS bowl appearance.
He also receives $150,000/year for 5 years to help pay the $750,000 buyout he owes Iowa State U. for departing before his contract ended there.
According to Bloomberg (Jan. 11, 2011), Chizik also made the final incentive of $600,000 by winning the national title, claiming 14 victories, and finishing in the Top 5 in the final AP poll.
Chizik did miss the $150,000 that was attached to his program reaching a score of 1,000 on the annual Academic Progress Rate for student athletes. Nor did he get the $50,000 bonus for a score of 950. The team had a 915 on its most recent evaluation.
How much were the Auburn players paid? The answer, of course, was $0. According to the NCAA website, “Student athletes are students first and athletes second. They are not university employees who are paid for their labor.”
Discussion questions:
1. Are incentives a good idea for professional athletes? For coaches?
2. Are there ethical considerations?
I always teach that rewarded performance tends to continue and that non-rewarded performance tends not to continue. This is based on research from a variety of resources. So if you want continued high levels of performance, you have to reward it. So called student-athelete football players get points or some sort of icon on their helmets for doing well, and a chewing out if they don’t. It would be nice if they also got paid something for their time. Coaches suck the blood out of these people and most of them never graduate nor do most of them get to the pros. Penn State insists on high graduation rates. You can see what Auburn insists on by what they reward.
Professor Higgins’ comments are excellent and thought-provoking. Are there any limitations on who in an organization should receive financial rewards. One colleague at Rollins College has proposed that any faculty member getting a tier 1 publication be rewarded with a $10,000 bonus that year. What about the President of the US? Maybe he should get an extra $200,000 if the deficit is reduced by 30%, or $50,000 if unemployment drops to 7%? I do believe that many college presidents receive a percent of the funds they raise in a capital campaign as their bonus for a job well done.
I have serious concerns with the type of bonuses Chizik received for the success of Auburn’s football program. First, it is hard to argue that his base salary was not adequate compensation for running a strong program. Further, the incentives for traditional football program success are so high (contract extensions and renewals, offers from other organizations, television shows and worldwide fame) that the monetary incentives are just non-motivating extra “gravy”.
I feel differently about bonuses for positive behaviors that are not otherwise rewarded, such as the awards for academic progress of his student athletes or getting through the season with fewer serious injuries. The spirit of teamwork is enhanced when the team thinks that you are motivated by their well-being as opposed to being willing to sacrifice their bodies and futures for a few dollars more.
It is a shame that the coach gets so much money, and the student athletes do not get anything. Why not give all those football players scholarships to graduate school. Don’t a lot of them go on to get Ph.D.’s so they can become professors?
I have a slightly different take on this subject. There seems to be a lot of disagreement with the coach’s salary, but there didn’t seem to be a great deal of understanding that most of that was paid not by the university but by boosters through foundations established to support the athletic department, company contracts (Nike, Under Armour), media and personal appearances, etc. Yes, I understand that the university guarantees much of the money, but I would argue that a majority of that money would not have been available to the university for use in its general fund. Therefore the salaries (while excessive) are really more of a shock factor than a real issue. At some point the ADs will realize that they don’t have the money to pay all of the coaches all of the money they are currently offering. At that point, sanity will reign and salaries will be brought under control But, as long as Texas, Ohio State, Alabama, Auburn, Michigan, LSU, etc have the resources from the TV deals (more than 3 billion alone from 2 TV contracts for the SEC), there will be bidding wars for talented coaches. Stewart Mandel at SI has written extensively on this subject.
As for graduation rates, D-1 student athletes graduate at a higher rate than the general student population according to 6 year graduation rates (even when you consider 2 year transfer students enrolling in 4 year institutions). According to The Chronicle (11/18/09):
“For those athletes who entered college in the 2002-3 academic year, the graduation-success rate was 79 percent. (The federal graduation rate for that cohort, by contrast, was 64 percent. The federal rate for the entire student body was 62 percent.)… Division I-A football teams, which are the largest and most competitive in the nation, showed no change in their 67-percent average graduation-success rate. Division I-AA teams, meanwhile, slipped slightly: 64 percent of their players graduated in six years, compared with 65 percent for the previous cohort.”
It is an easy area to get everyone engaged since opinions are so heated, so it’s like “should we pay student athletes” and “should there be a playoff in college football.” The simple fact of the matter is that there are no easy answers and there is hypocrisy on both sides of the issue. What really bothers me is that, much like the fall of Rome, we are celebrating (worshiping)/paying our athletes, coaches, and actors too much and not investing in infrastructure and education. Rather than celebrating our soldiers, teachers, construction workers, etc, we have focused on fast and easy and glamorous.