The Cost of Discrimination: A Study of Major League Baseball
Author(s): Andrew Hanssen
Source: Southern Economic Journal, Vol. 64, No. 3 (Jan., 1998), pp. 603-627
Published by: Southern Economic Association
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SouthernEconomic Journal 1998, 64(3), 603-627
Cost
The
Major
of
League
Discrimination:A
Study
of
Baseball
Andrew Hanssen*
This article seeks to determine whether discriminatorsperform differently than nondiscriminators, whether that performancedifference serves to inhibit discrimination,and, if so, how
the process works. It investigates an area with abundantdata on both the racial mix of participants and firm performance-major league baseball. A sizeable and statistically significant
relationshipbetween winning and the presence of black players in the startinglineup is found
to hold for the early years of the 1950s and to decline, as expected, as the average numberof
black ballplayerson majorleague rostersincreased.However,a puzzle emerges in the fact that
a significantlyslower rate of integrationwas pursuedin the AmericanLeague (AL) than in the
National League (NL) despite there being nearly identical associations between black players
and winning in each. The most likely solution to that puzzle is that fan preferencesdifferedeach black player on an AL team appearsto have reduced attendanceby significantlymore
than he would have on a NL team. Examinationalso reveals that when substituteplayers are
considered separately,the positive association between the number of blacks employed and
winning is much weaker, whereas the negative association between black ballplayersand attendance is the same. Not coincidentally,black players made up a significantly smaller proportion of substitutesthan they did of startersthroughoutthe entire period.
1. Introduction
This article probes the causes and consequences of discrimination.' Theorists have pointed
out that discrimination is costly and have suggested that the cost may reduce its incidence.2
That proposition, while appealing, is difficult to test. This article attempts to do so. It seeks to
determine whether discriminators perform differently than nondiscriminators, whether that performance difference is sufficient to inhibit discrimination, and, if so, how the process works. It
does this by examining an area with a clear history of discrimination and abundant data on
both the racial mix of participants and performance-major league baseball.
This is not the first article to use baseball as a laboratory for investigating the effects of
discrimination on performance.3 Gwartney and Haworth (1974) find a positive relationship between the cumulative number of years played by black players and the number of games won
annually between 1950 and 1959 and cite this as evidence that discrimination (the failure to
* Departmentof AgriculturalEconomics and Economics, MontanaState University, Bozeman, Montana59717,
USA; E-mail [email protected].
I am very grateful for the help and suggestions provided by TorbenAndersen, Rob Fleck, Rob Gertner,Ron
Johnson, Sumner LaCroix, Sam Peltzman, Randy Rucker,Lester Telser,two anonymousreferees, and participantsat
seminarsat the Universityof Chicago and MontanaState University.
Received October 1996; acceptedAugust 1997.
'Kenneth Arrow (1973, p. 3) writes "The notion of discriminationinvolves the additionalconcept that personalcharacteristicsof the workerunrelatedto productivityare also valued on the market."
2 The archetypalmodel was developed by Gary Becker (1957).
3 See Kahn (1992) for a review of studies on discriminationin sports, with a particularemphasison discriminationin
baseball.
603
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604
Andrew Hanssen
hire black players) was costly. This article confirmstheir conclusion and picks up where they
leave off. Much of interest is to be learned from the way integrationoccurred:how rapidly,
which teams, and which players.Differences over time betweenAmericanand Nationalleagues,
between playersin the startinglineup and playerson the bench, and between the hiringof black
ballplayers and the hiring of "white Latins" all shed light on the process. Given baseball's
restrictionson entry (new teams are permittedonly on a super-majorityvote of existing owners),
the main force impelling the integrationof a given team was the contemporaneousintegration
of existing rivals. Indeed, the color barrierwas itself the result only of a tacit agreementamong
major league owners. The study of baseball and the end of the color barrieris the story of a
discriminatoryarrangementbreakingdown. The way it did so may offer lessons of value to
today's debate on policies to combat discrimination.
The analysis to follow considers the 35 year period from 1950 (the third year after the
breakingof the color barrier)to 1984. It finds that teams that startedfewer black players than
their rivals lost significantly and substantiallymore often. That differential appears to have
encouragedthe steady integrationof major league startinglineups. However, the teams of the
AmericanLeague were significantlyslower to integratethanthose of the NationalLeague. This
is a puzzle given that the association between black players and winning was nearly identical
across the leagues. The most likely solution to that puzzle is that fan preferencesdiffered.
Holding other factors constant, substantiallylarger declines in attendanceare found to be associated with black players in the Americanthan in the NationalLeague. Finally, when substitutes are examinedseparately,the associationbetweenthe numberof black ballplayersemployed
and winning is found to be much weaker (not surprisingly),whereas that between black substitutes and attendanceis the same as for black starters.As a balancing of costs and benefits
would predict, black ballplayersmade up a significantlysmaller proportionof substitutesthan
they did of startersthroughoutthe entire 35 year period examined.
The article proceeds as follows: section 2 provides a brief history of the participationof
black men in baseball and the breakingof the color barrier,section 3 presentsthe analysis, and
section 4 concludes.
2. Black Ballplayers and Baseball
Black participationin professionalbaseball dates back nearly to the founding of the first
professionalteam, the KnickerbockerClub of New York, in 1845. Integratedcompetitionwas
not always popular--black players were formallybannedfrom playing with whites for the first
of many times in 18674--but continueduntil the end of the 19th century.The NationalLeague
(the older of the two leagues that today comprisemajorleague baseball)excluded black players
from its inception in 1872, with Cap Anson, the Hall of Fame first baseman from Chicago,
being the color barrier'smain architect.The last black team to regularlycompete with white
teams was the Acme Colored Giants of the 1898 Iron and Oil League (Peterson 1970). From
1898 to 1946, black ballplayerswere relegatedto their own leagues (the Negro Leagues, which
did at times flourish) although no formal statute banning black participationin major league
4 The NationalAssociationof BaseballPlayersissued the following proclamationthatyear: "It is not presumedby your
committeethat any clubs who have applied are composed of personsof color .... They unanimouslyreportagainst
the admissionof any club that may be composed of one or more colored persons."Quotedin Scully (1989, p. 172).
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The Cost of Discrimination
605
baseball (National and American leagues) was ever enacted.5Instead, the absence of black
players was attributedto such things as inferiorability and naturalpreference.The falseness of
those claims was apparentin the various dodges tried. For example, the barnstorming,black
CubanGiantsof the late 19th-early20 centurywould speak gibberishas they tossed the baseball
aroundto convince fans that they were "Spanish," and John McGrawof the BaltimoreOrioles
attemptedto field black second baseman Charlie Grant in 1901 by claiming that he was an
Indian named "Chief Tokohoma."
The signing of Jackie Robinsonby BranchRickey, Presidentof the BrooklynDodgers, on
October 23, 1945, sounded the death knell for segregation.After playing for one year for the
Dodgers' Montrealminor league franchise,Robinson startedat first base for the Brooklynteam
in 1947, batted .297, was named Rookie of the Year,and led the Dodgers to the pennant(the
Dodgers had finished second the previous year). The ClevelandIndiansbecame the first American League team to sign blacks later that same year and moved from fourthplace in 1947 to
the pennant in 1948. The Dodgers continued to add black players (Roy Campanellain 1948
and Don Newcombe in 1949), inspiringtheircross-townrivals, the New YorkGiants,to become
the second National League team to sign black ballplayers (two for the 1949 season). The
Giants then won the NL pennantin 1951 and again in 1954.
Why the color barrierwas brokenwhen it was remains an open question.CertainlyAmerican attitudeshad changed to the point where integration,once widely opposed, was judged
acceptable(the South remainedan obvious exception). GunnarMyrdalpublishedThe American
Dilemma, which examined the lot of the African American, in 1944. It became a best-seller
and stimulatedextensive discussion of the "Negro problem." The fact that thousandsof black
soldiers had died for their country alongside white soldiers in World War II reputedlyhad a
strong effect on the public mind, although much of the armed forces remained segregated
throughout the war. The Brown v. Board of Education of Topeka case that would put an end
to the "separatebut equal" doctrine in 1954 would soon begin to wend its way throughthe
courts. This change in attitudeswas apparentin a 1956 ScientificAmerican survey thatreported
that one-seventh of Northernwhite people and two-fifths of Southernwhite people believed the
Black race to be less intelligent, as comparedto one-half and four-fifthsin the same survey 12
years before (see Bardolph 1961). Journalistsand politicians were criticizing baseball's color
barrier,6and as early as 1938, ClarkGriffith,owner of the WashingtonSenators,stated, "There
are few big league magnates who are not aware of the fact that the time is not far off when
colored players will take their places beside those of other races in the majorleagues" (Tygiel
1983, p. 32).
Because of the change in attitudes,and the complementaryrise of a wealthierblack class,
the integrationof baseball presentedthe prospectof money to be made. Black athletes in other
arenas, for example, Joe Louis in boxing and Jesse Owens in track,were highly popular.Fur-
5In responseto a statementby Dodger managerLeo Durocherthat he would field black playersif allowed to, Baseball
CommissionerKenesaw MountainLandisdeclaredin 1942, "Thereis no rule, formalor informal,or any understanding-unwritten, subterranean,or sub-anything-against the hiringof Negro playersby the teams of organizedbaseball
.... Negroes are not barredfrom organizedbaseball, and never have been in the twenty-one years I have served"
(Tygiel 1983, pp. 30-31). Few observerstook such statementsseriously.
6 Althoughthe firstand most scathingcommentarywas from writersin the then-extensiveblack press, by the late 1930s
more mainstreamcritics (from the "white" press) had joined them. These included influentialsportswritersShirley
Povich, Heywood Broun, and Jimmy Powers. All arguedthat great talent was going to waste, and that baseball as a
whole would benefit from integration(see Scully 1974b).
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thermore,black baseball'sNegro Leagues had prospered.By the end of WorldWarII, the Negro
Leagues were the largest black-dominatedbusiness in America, worth in excess of $2 million
(Tygiel 1983). The annualEast-WestNegro All-Star game drew a record51,000 fans to Comiskey Park in Chicago in 1943. The demand for Negro baseball was also apparentin the rents
paid for the use of majorleague stadiums.The New York Yankees,for example, received over
$100,000 per annumfrom leasing YankeeStadiumto Negro teams on those weekenddays when
they (the Yankees)were on the road (Tygiel 1983).
Finally, there was the man who did it. BranchRickey, the Dodger's President,was by all
accounts a uniquely perceptive baseball man.' While General Manager of the St. Louis
Cardinals,he developed the system of minor league team affiliationthat enrichedthe Cardsfor
years and became the majorleague standard.8He moved from the Cardinalsto the Dodgers in
the early 1940s and stole a jump on the rest of the league by increasingscoutingin anticipation
of an allied victory in 1945 (scouting operationshad been reduced everywhere-why sign a
young prospectif he is to be promptlydrafted?).Rickey proceededin his decision to hire Major
League Baseball's first black player in a deliberateand canny fashion. He announcedthat the
Dodgers were to underwritea new Negro league, in which would play an affiliatedteam, the
Brown Dodgers. He then assigned scouts to search for the top black players in America and
the Caribbean,the obvious presumptionbeing that those players would join the Dodger'sblack
affiliate. At the same time, Rickey held meetings with sociologists and "race experts" in order
to discuss the implication of fielding an integratedteam (hypotheticallyspeaking, of course).
The fact thatRickey had been highly criticizedfor the Dodger'spoor performance(they finished
seventh in an eight-team league in 1944), and even hung in effigy outside his office window,
may have given additionalurgency to his quest. He was shrewd enough to hold off on announcing the signing of Jackie Robinson until he had effectively locked up several other top
black prospects,includingfutureMost ValuablePlayer and Hall-of-FamerRoy Campanellaand
futureRookie of the Year and Cy Young Award winner Don Newcombe.
As Tygiel (1983, p. 51) notes, "The reasons for Rickey's unilateralaction have provoked
debate for decades." Rickey himself was never precise as to why he chose to break the color
barrier.For popularconsumption,his favorite story was of the time when, as baseball coach at
Wesleyan College, he provided a cot in his room at a segregated hotel to a distraughtblack
Wesleyanplayer (this was the usual practicewith regardsto black valets). "The scene haunted
me for many years, and I vowed that I would always do whatever I could to see that other
Americans did not have to face that bitter humiliation."At other times his remarkscarrieda
differentemphasis, "The greatestuntappedreservoirof raw materialin the history of the game
is the black race! The Negroes will make us winnersfor years to come, for which I will happily
bear being called a bleeding heart and a do-gooder and all that humanitarianrot."9 It has also
been suggested that the Dodgers were more directly hurt by Negro competitionthan either of
its New York rivals and thus faced with less sorrow the prospect of a decline in the demand
7Demmert(1973, p. 73) writes, "BranchRickey is widely recognizedas one of the most astuteexecutivesin the history
of major league baseball." Tygiel (1983) points out that by 1949, three out of every eight majorleaguershad been
developed on one of Rickey's farm teams.
8 St. Louis, a small-marketfranchise,made much of its money by selling the players it developed in its minor league
system to wealthierclubs (see Demmert 1973).
9 Both quotes are from Tygiel (1983, p. 52).
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The Cost of Discrimination
607
for Negro baseball.'0However, the Dodgers themselves were doing well at the box office even
before Jackie Robinson was signed.
In short, the most plausible explanationfor why integrationoccurredwhen it did was that
beliefs had changedto the point where the majorityof Americansexpectedbaseballto integrate,
the potentialto attractfans (and make money) with black ballplayerswas apparent,and all that
was requiredwas the daring individualto make the first move."
Before proceeding, a last question should be asked: To the degree that discrimination
occurred,what was its source? The obvious candidates-owners, fans, and fellow players and
coaches-have all been implicated.12 The subsequent section will examine evidence of both
owner and fan discrimination.
3. Analysis
The analysis to follow links a team's performanceto its willingness to hire black players,
and investigateswhethersubsequenthiringwas influenced,accordingly.13 The analysisconsiders
the period from 1950 to 1984, investigatingthe 16 majorleague teams that existed for the entire
10
Baseball owners cited the collapse of the Negro Leagues that would inevitablyfollow the breakingof the color barrier
(and they were correct)as a reason that they shouldn'tsign black playersthemselves (see Tygiel 1983).
11Rickey was not the only baseballexecutive to perceive the
potentialgains from signingNegro Leaguestars.Bill Veeck,
whose ClevelandIndiansbecame the first AmericanLeague team to sign a black player in 1947, almost beat Rickey
to it. Veeck reportsthat he tried to buy the PhiladelphiaPhillies in 1944 (before he had purchasedthe Indians).His
plan was to stock them with the top black talent available. "I have not the slightest doubt that in 1944, a war year,
the Phils would have leaped from seventh place to the pennant."Unfortunatelyfor him, he reportedhis plan to thenCommissionerKenesawMountainLandis,who made no commentbut subsequentlyoversaw the sale of the Phillies to
a rival bidderfor half the price that Veeck had offered (see Veeck and Linn 1962, p. 170).
12Baseball owners frequentlyand publicly expressedracist sentiments-see the section titled "The Patternof Integration"-as some continue to do today (e.g., Marge Schott of the CincinnatiReds). However,evidence also indicates
that at least some fans had racial biases as well. Scully (1974a), for example, shows team revenue to be declining in
the percentageof the rosterthat is Black, and Nardinelliand Simon (1990) and Andersenand La Croix (1991) find a
pro-Whiteplayer bias in the baseball card market.There is also evidence that many white players, managers,and
coaches had an aversionto black players.In the 1920s, there were rumorsthat such starsas Rogers Hornsbyand Tris
Speakerwere membersof the Ku Klux Klan. Variousteams indeed threatenedto boycott their games with Brooklyn
afterJackieRobinsonwas signed. Even within the Dodgers therewere problems.An anti-Robinsonpetitionwas passed
amongDodgerteammatesduringRobinson'sfirstspringwith the team, althougha midnightmeetingwith Leo Durocher
nipped the idea in the bud. Jackie Robinson set a rookie recordfor numberof times hit by a pitch (nine) and led the
league the following year (a reported25% of black Triple-Aplayers-of which there then were not many-were at
one time or anotherhospitalizedby beanballsduringthe 1949 season). Racist insults from the opposing bench were
the norm.Managerswere also often racistthemselves(Casey Stengel, the Yankeemanager,regularlyreferredto "jungle
bunnies" and "niggers," and Alvin Dark of the Giants questioned whether blacks had the mental aptitudeto be
coaches), but in practicerecognizedthe benefit of a good player.As Hank Aaronput it, "Theirattitudewas, 'Let 'em
live. Keep 'em satisfied'." (Tygiel 1983, p. 305).
13For a less discriminatingteam to have benefitted,it must have been that black playerswere availableat a lower price
for a given quality than white players. There is evidence that this was so. The high quality of early black hires is
attested to by the large numberof Rookie-of-the-Yearawards (black players won the Rookie-of-the-Yearaward six
times in the seven years after Robinson'sdebut), MVP awards,and Hall of Fame enshrinements.And these players
were substantiallycheaperthan their white counterparts.Peterson(1970) notes that in the 1940s, most Negro League
players were earning $125-$300 per month (althougha few stars, such as Satchel Paige, earnedsubstantiallymore).
In contrast,an unprovenJackie Robinson signed with the Dodgers for an initial salary of $600 per month (plus a
$3500 bonus). Tygiel (1983, p. 20) quotes Indiansowner Bill Veeck after the signing of black outfielderLarryDoby,
"I simply couldn't find, at those prices, a ballplayerof similartalent."
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Andrew Hanssen
interval.Post-1960 expansionteams and pitchersare excluded.14 AfricanAmericansand "black
Latins" (i.e., those from Latin America who could not have played majorleague baseballunder
the color bar) are groupedinto the single category "black," and furtherdivided between "starters," those who played the most games at a given position in the course of a season, and
"bench," those who did not startbut played in at least 20 games in a season for a given team.15
Discrimination and On-the-Field Performance
Black Starters and Winning
Underlyingthis section's analysis16 is the assumptionthat owners like their teams to win,
because winners attractmore fans and are thus more profitable,17 because winning is fun and
owners who have winning teams get lots of attention,'18or througha combinationof the two.
There may be a trade-off between winning and other considerations(monetary cost, racial
composition, effort), but all else equal, more winning is preferredto less.
To test the hypothesis that discriminationaffects winning, I will estimate the association
between annualwinning percentageand the relativeemploymentof black ballplayers(measured
as the deviationin the numberof black ballplayersin the team's startinglineup from the league
average)19with a squaredterm included to allow for nonlinearities.As controls, I include the
populationof the relevant standardmetropolitanstatisticalarea (SMSA)-teams in largerareas
have been posited to receive greaterreturnsto winning (see e.g., Noll 1974, 156). The demand
for winnersmay also vary with an area's wealth, so the deviationfrom mean per capita SMSA
income will be included in the equationas well.20 Because I look over time (1950 to 1984), I
will weight for first order autocorrelation.And because team winning percentages within a
14 Only the originalteams are includedso
thata common samplemay be comparedover the full period.Expansionteams
do not appearto have differedin any significantway from the rest of baseball in their racial hiringpractices.Pitchers
do not play every day, so their effect on team winning and attendancewill be differentfrom that of a regularplayer.
Furthermore,pitchersare harderto divide into the starter/substitute
dichotomythatis used here. Finally,the continuing
dearthof black pitchersis a puzzle that this articledoes not attemptto address.
15The choice of 20 games is admittedlyarbitrary;the objective is simply to establisha minimumlevel of participation
below which a player is not counted as a true memberof the team. Were 15 or 25 games used instead,the effect on
the numberof playersincludedwould be very small.
16Startersand substitutesare examined separatelyin orderto determinewhetherthe strengthof the associationbetween
black players and winning dependson the importanceof the player and whetherdifferenthiring patternsensue. This
section begins with the startinglineup. Data on winning are drawnfrom Neft and Cohen (1992). Data on racial mix
were harderto obtain. The primarysources were team pictures (which I collected at the Baseball Hall of Fame in
Cooperstown,New York), Who's Who in Baseball (an annualpublicationof Who's Who in Baseball MagazineCo.,
New York), and the much appreciatedcounsel of Dick Clark, Co-Chairmanof the Negro League Committeefor the
Society of AmericanBaseball Research(SABR).
17The link between winning and revenue has been establishedfor individualyears-it is positive and strong (not surprisingly). Scully (1989) calculates that, holding baseball ticket prices constant,each point increase in winning percentage in 1984 attractedan additional3485 fans, implyingthateach victory was worth$135,730 in additionalrevenue.
18 In their study of corporateownershipof all kinds, Demsetz and Lehn (1985, p. 1162) hypothesizethat nonpecuniary
returnsare particularlyimportantin professionalsports, "Winningthe World Series ... plausiblyprovides utility to
some owners even if profitis reducedfrom levels otherwise achievable."
19One might logically expect relative hiring to affect winning more directly than absolutehiring. However,if level of
black startersis used instead,the result is qualitativelysimilar.
20These measuresare taken from the U.S. censuses of 1950, 1960, 1970, 1980, and 1990, with a linear trendassumed
to estimatethe years between each census.
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The Cost of Discrimination
609
league necessarily average to .500 for a given season (team A's win is team B's loss), I must
correct for contemporaneouscorrelationin the errorterms.21
If the exclusion of black ballplayersaffects winning, those teams with more black players
relative to their opponentsshould win more often (and vice versa).The results, shown in column
1 of Table 1, indicate that this was so. Both black starterscoefficients are positive and statistically significantat less than 1%, implying that teams above the league mean in black hiring
won more often, those below it lost more often, and that the furtherfrom the league mean a
team found itself, the strongerthe effect. The magnitudeof the coefficients indicates the importanceof the effect; between 1950 and 1984, startingone more black playerthan the average
team was worth an additional .010 points on winning percentage,or one and one-half extra
wins per year.22
Figure 1 shows the growthin the average numberof black playersin majorleague starting
lineups between 1950 and 1984. Given that increase, the relationshipbetween black starters
and winning might be bettermodeled as changing-the gap in ability between the inframarginal
black and white players may have declined, or the between-teamvariationin the number of
black players shrunk.Two interactionterms are added to allow it to do so: the deviation in
numberof black startersX the league mean, and the deviation in the numberof black starters
X the league mean squared.
The results of the second estimation are shown in column 2 of Table 1. The coefficients
on the two previously included black startersmeasures remain of the same sign as before,
whereasthat on the first interactionterm is statisticallysignificantat less than 1%and negative,
implying a weakening of the association between black startersand winning as the numberof
blacks in baseball grew (the coefficient on the higher orderinteractionterm is small and statistically insignificant).Togetherthe point estimatesimply that having one black starterabove the
league mean was worth an additional.037 winning percentagepoints, or nearly six additional
wins in 1950 (when the league mean was .375 black startersper team), falling to only .001
additionalwinning percentagepoints by 1984 (when the league mean was 3.5 black startersper
team), substantiallyless thanone additionalwin. The effect in the early periodwas large indeed;
the average gap between first and second place teams over the last fifty years is six games.
Did the effect of black starterson winning differ between leagues? Column 3 of Table 1
displays the resultof reestimatingthe equationshown in column 1 with National-League-specific
black starterterms. The coefficients on the National League variables are small, implying a
between-league difference of only 0.3 of a win, and nowhere near statistical significance. Including league-specific versions of the interactionterms (column 4) produces the same result;
the implied AL/NL difference is tiny, and none of the coefficients are statisticallysignificant,
individuallyor jointly. A Wald test fails to reject the null hypothesis of no difference between
leagues in the effect of black starterson winning (Wald statistic = 0.68, p = 96%).
In short, teams that startedfewer black players appearto have lost more often as a result,
21The ARI weightings are developed using team-specificautocorrelationcoefficients,which range from nearly 0 to 0.7.
Results of log-likelihood tests indicate that autocorrelationcorrectionsare called for-the null hypothesisof no correction is rejected at well under 1%. Contemporaneouscorrelationis correctedfor throughiteratedgeneralizedleast
squares.The results describedin this section are robustto alternateweightings as well, includingno correctionat all.
22The value of the "deviationin black starters"variableis equal to one for a team with one more black playerthanthe
league mean.Through1960, each league played 154 games per year;post-1961,each league played 162 games.Because
the averageteam wins half its games, the estimatesimply thata single blackplayermorethanthe league meanimproved
the averageteam by 2%.
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Table 1. Effect of Black Starterson Winninga
(1)
0.490***
Constant
NormalizedDeviation in Black Starters
NormalizedDeviation in Black StartersSquared
(0.005)
0.005**
(0.002)
0.005***
(0.001)
0.039***
(0.006)
0.003
(0.002)
-0.012***
(0.002)
0.0002
(0.0002)
0.378***
(0.109)
-0.182***
(0.051)
InteractionWith League Mean Squared
Per CapitaIncome
0.496***
(0.005)
InteractionWith League Mean
Population
(2)
0.521***
(0.103)
-0.148**
(0.050)
NormalizedDeviation in Black Starters(NL)
NormalizedDeviation in Black StartersSquared(NL)
InteractionWith League Mean (NL)
InteractionWith League Mean Squared(NL)
R2 b
0.130
0.144
Dependentvariable:percentgames won; numberof observations:560. Significantat *** 1%, ** 5%, and * 10%.
bR2from calculatingcorrelationbetween fitted and actual values of dependentvariable.
a
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The Cost of Discrimination
611
7
1
6
-r
,r
.
00
Starters
-.
,
-Total
Figure 1. Average numberof black playersper team (does not include pitchers).
but at a declining rate as time passed and the numberof black startersin baseball rose. The
effect is common across leagues. This is consistent with the propositionthatdiscrimination(the
exclusion of black ballplayers)was costly.23
Previous Team Quality
Although the finding that black startersare associated with significantlyhigher winning
percentagesis consistent with costly discrimination,it is also consistent with anotherproposition-that betterteams startedblack players before worse teams. If this were so, the coefficient
on the black startersvariable would overestimatethe effect of black players on winning. This
section employs durationanalysis to investigate the relationshipbetween the hiring of black
players and previous team quality.24
A Cox proportionalhazardmodel will be used relate the time it took a team to start its
first black player (in years from 1947) to winning. The hazardrate is estimated, defining the
probabilitythat a team drops out of segregation(i.e., starts its first black ballplayer)in year t,
given that it has remained segregateduntil then. Average winning percentagefrom 1947 (the
year Jackie Robinson startedfor the Dodgers) to the year in which a team startedits firstblack
ballplayer is the primary covariate of interest (the 1946 winning percentage is used for the
Dodgers). Because the dependentvariablereflects the conditionalprobabilityof failure (i.e., the
23A fixed-effectsmodel was also run to control for remainingcross-teamdifferences, althoughthe length of the period
analyzed raises questions about the effectiveness of that approach(managersand players do not tend to last for 35
years). The results are qualitativelyequivalent,with the coefficients on the black startersvariablesimplying a slightly
greaterimpact than in the estimationsshown.
24 An alternativewould be to enter controls for team quality directly into the estimationof the black starters/winning
relationship.However,findingthe appropriatemeasureis problematic;black players are addedprecisely because they
improve team quality. The ideal quality measure would capturewhat team quality would have been had no black
players started.Of course, the correspondingroster,strategy,etc., would then have been different.Lagged values of
place of finish, winning percentage,team battingaverage, and averagewhite battingaverage were all included(independently)as controls, while recognizingthat each reflects the decision to startblack players (or not). In no case did
the associationbetween black startersand winning change substantially.
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612
Andrew Hanssen
startingof a black ballplayer),covariates that enter positively are associated with a reduction
in the amountof time a team remains segregatedand vice versa. Thus, if winning teams hired
black players more rapidly than losing teams, the coefficient on post-1947 winning percentage
should be positive. In recognitionof the fact that teams vary in how fast their rostersturnover
(the faster the turnover,the more the new players, and thus the greaterthe opportunityto add
black players), the numberof new startersfielded between 1950 and 1955 will be included as
a control.
The result of the estimation(standarderrorsin parentheses)is:
-In X = -6.324(winning percentage)- 0.123 (new starters).
(4.8)
(0.08)
The winning percentagecovariatedoes not enter positively, but rathernegatively, and is statistically significantonly at about 20%. Far from better teams having startedblack players more
quickly, it appearsthat worse teams did. The positive association between black startersand
winning does not transpirefrom better teams having integratedmore rapidly.
The Simultaneityof Black Starters and Winning
The resultsfrom the hazardmodel still suggest the possibility of simultaneity-black starters promote winning, and the worse a team, the greaterits hiring of black starters.25
If this is
so, the coefficient estimates of Table 1 are biased and inconsistent.26The association between
black startersand winning will thereforebe reestimatedvia a two-stage method. In the first
stage, an instrumentfor the black startersmeasure will be developed using the following exogenous variables:populationand income per capita, the percentageof the populationthat is
black, a time trend,and a numberof variablesintendedto captureracialattitudesin the relevant
SMSAs.27That instrumentwill be included in the second-stageregressionin place of the black
startersterms.
The second-stageestimates are shown in Table 2.28The associationbetween black starters
and winning remainspositive and statisticallysignificant.The results in column 1 imply that a
single black player above the league mean was worth about two wins to his team per year over
the entire period, a slightly strongereffect than that implied by the single-stageestimation.The
results in column 2 also suggest a strongereffect in the early years following the breakingof
the color barrier(more than 15 games per deviation in the 1950s) that then declined more
rapidly. As in the single-stage estimation, columns 3 and 4 show no evidence of statistically
significantbetween-leaguedifferencesin the effect of black starterson winning.
25Perhapsan additionalwin was worthmore to a loser than to a winner,or the marginalimpactof a black playergreater
(the white player being replacedis likely to have been of lower quality).
26A Hausmantest rejects the null
hypothesisof no simultaneityat nearly 1%.
27 The
racial attitudesvariablesare: an index of residentialsegregation,White and non-White, 1950, 1960, and 1970
(Sorensen,Taeuber,and Hollingsworth1975); residentialdissimilaritybetweenBlack and White, 1970 and 1980 (Massey and Denton 1987); probabilityof residentialcontactbetweenBlack and White, 1970 and 1980 (Massey andDenton
1987); an index of black residentialisolation, 1970 (Massey and Denton 1993); and the percentageof the electorate
that voted for George Wallace for Presidentin 1968. Population,income, and percentageBlack are taken from the
census data of 1950, 1960, 1970, and 1980, with a lineartrendused to estimatethe years betweeneach census.
28The result of the first stage estimation is: black starters = 1.31 + 8.12*population- 2.99*income per capita 2.77*percentblack population+ 0.09*trend- 0.05*segregation- 0.37*probabilityof black/whiteresidentialcontact
+ 2.99*residentialdissimilarity+ 0.33*black isolation + 14.2*percentWallacevote.
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Table 2. Effect of Black Starterson Winning (InstrumentalVariables)a
(1)
Constant
NormalizedDeviation in Black StartersInstrument
NormalizedDeviation in Black StartersSquaredInstrument
0.502***
(0.006)
0.024***
(0.008)
-0.013
(0.008)
InteractionWith League Mean Instrument
InteractionWith League Mean SquaredInstrument
Population
Per CapitaIncome
0.413***
(0.118)
-0.166***
(0.005)
(2)
0.502***
(0.005)
0.129"**
(0.021)
-0.024*
(0.013)
-0.040***
(0.008)
0.003***
(0.001)
0.383***
(0.118)
-0.225***
(0.005)
NormalizedDeviation in Black StartersInstrument(NL)
NormalizedDeviation in Black StartersInstrumentSquared(NL)
InteractionWith League Mean (NL)
InteractionWith League Mean Squared(NL)
0.109
R2 b
*** 1%, ** 5%, and * 10%.
Dependentvariable:percentgames won; numberof observations:560. Significantat
bR2calculatedfrom correlationbetween fitted and actual values of dependentvariable.
a
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0.132
614
Andrew Hanssen
Table 3. Yearin Which First Black Player Hired
Team
Brooklyn Dodgers
Cleveland Indians
New York Giants
Boston Braves
Chicago White Sox
PhiladelphiaAthletics
PittsburghPirates
CincinnatiReds
St. Louis Cardinals
Chicago Cubs
WashingtonSenators
BaltimoreOrioles
New York Yankees
PhiladelphiaPhillies
Detroit Tigers
Boston Red Sox
League
First Black
Player
First Black
Starter
NL
AL
NL
NL
AL
AL
NL
NL
NL
NL
AL
AL
AL
NL
AL
AL
1947
1947
1949
1950
1951
1954
1954
1954
1954
1955
1955
1955
1955
1958
1958
1959
1947
1948
1949
1950
1951
1954
1954
1956
1958
1955
1955
1956
1959
1960
1961
1965
The results appearrobust.Teams that were reluctantto startblack playerspaid the pricethey lost more often. And that price didn't differ across the leagues.
The Pattern of Integration
The breakingof the color barrierwas followed by the steady integrationof major league
rosters shown in Figure 1. As can be seen however, nearly 25 years passed before baseball's
hiring of black players peaked and stabilized.Although one might indeed have anticipatedthat
adjustmentswould be required,29the slow pace at which integrationproceededran counter to
expectations. Branch Rickey, for one, had predicted that the color line would be completely
eliminatedwithin a year (Tygiel 1983). Bill Veeck, owner of the ClevelandIndians,agreedand
hurriedlyplaced black players undercontract.He said, "Why wait? I wanted to get the best of
the available Negro boys for Cleveland while the grabbingwas good" (Veeck and Linn 1962,
p. 111). But fellow baseball executives resisted. Table 3 lists the years in which teams placed
the first black player on their majorleague rostersand in their startinglineups. Five years after
Jackie Robinson stepped on the field for the Brooklyn Dodgers, more than two-thirds of all
teams had yet to assign a single black player to their major league roster,and even five years
after that, one-quarterof all teams had yet to start a single black player. This was in sharp
contrast to what occurredin a number of the minor leagues. For example, the Pacific Coast
League (made up in large part of unaffiliatedclubs) saw its first black player,star and drawing
card Luke Easter,assigned to the San Diego affiliate in 1949. Within two years, every club in
that league fielded at least one black player.Even in the South, the Texas League saw its first
29For example, to hire additional scouts with links to the
appropriate groups, expand training programs, allow new players
to "season" on the bench, and let established starters fade. It may also be that the increased number, or lucrativeness,
of the opportunities represented by major league baseball expanded the pool of black players seeking to enter.
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The Cost of Discrimination
615
signing of a black player,pitcher Dave Hoskins, in 1952; by 1955, only the Shreveport,Louisiana club remainedall-white.30
The most interestingaspect of the integrationprocess is that the National and American
Leagues proceeded at substantiallydifferent speeds. Figure 2a comparesthem in terms of the
average numberof nonpitchingblack players on the roster.American League hiring of black
players trailed National League hiring from the very beginning of the period until the early
1970s. The t-tests indicate that the average National League team had significantlymore black
players on its rosters than the average AmericanLeague team at the 5% level or better (onetail test) for 16 of the 19 years from 1954 to 1972, and at the 10% level for the rest. That
difference was not the result of a few outliers. Figure 2b graphsthe five-year league averages,
and plots individualclubs with respect to their particularfive-yearaverage for the threeperiods
for which the AL/NL difference was greatest:1955-1960, 1960-1964, and 1965-1969. As can
be seen, the differencebetween the leagues is striking.In each case, the AmericanLeagueleader
is, at best, equal to the median National League team in its hiring of black ballplayers.
Given that teams from both leagues had access to and need for similar kinds of players
that
and
the effect of black players on winning (as shown in the previous section) was nearly
identical across leagues, the difference in pace of hiring is a puzzle. Two broad possibilities
have been suggested to explain it: (i) AmericanLeague owners were more racist than National
League owners and (ii) AmericanLeague fans preferredwhite players more strongly than National League fans.31 I will addressthem one at a time.
To begin with, there were undoubtedlyracist American League owners. The two teams
most often criticized for excluding black players were the New YorkYankeesof the 1950s and
early 1960s, and the Boston Red Sox to this day; both are in the AmericanLeague.32The color
bar was broken by a National League team. Ergo, some have concluded, AL owners are more
racist.However,as Figure2b shows, the AL/NL differencein employingblackplayersis leaguewide, not due to the effect of two idiosyncraticteams. Furthermore,although various AL executives were openly racist, there were also openly racist NL executives.33Baseball executives
as a group were highly critical of Robinson's signing-a secret reportfrom the owners condemned it 15 to 1. A public steeringreportthat followed expressedsimilarsentiments;its major
30See Tygiel 1983, chapters 13 and 14. Shreveportswitched to the still-segregatedSouthernAssociation a few years
later.Interestingly,that league found itself boycottedby black fans from the mid-1950s onwardanddisbandedin 1961.
31Pascal and Rapping(1972) hypothesizethat the preferencesof club owners varied (or the AL just got off to a slower
start).Halberstam(1989 and 1994) suggests that AL owners (at least those mentioned)were indeed more racist, and
Tygiel (1983) appearsto lean towarda fan-basedexplanation.
32Halberstam(1994, p. 55) reportsYankeeGeneralManagerGeorgeWeiss instructinga scout, "I don't wantyou sneaking
arounddown any back alleys and signing any niggers. We don't want them." (They lost the chance to obtainHall-ofFamerErnie Banks, accordingly.)Halberstam(1989, p. 200) reportsRed Sox GeneralManagerMike Higgins calling
a Boston reportera "nigger lover" for praisingthe ability of Minnie Minoso, a black Cubanoutfielder.(Halberstam
also notes that both teams fell on hardtimes in the 1960s.)
33For example, the PhiladelphiaPhillies GeneralManagerHerb Pennockreportedlytold BranchRickey in 1947, "(You)
just can't bringthat nigger (JackieRobinson)here with yourteam. We'rejust not readyfor thatkind of thing." (Rickey
replied that he would be happy to accept the forfeit and the game went on as planned-see Tygiel 1983, p. 185). Fred
Saigh of the St. Louis Cardinalsreportedlypromisednever to allow a black player in a Cardsuniform. Halberstam
(1994, p. 233) writes of black catcherElston Howardattendinga tryout camp for local kids hosted by the Cardinals
in late 1940s. "At the end the people runningthe camp apologized and told him they were sorry,thathe was the best
prospectthere, but that the Cardinalsdid not sign black players." (Howardeventuallybecame the firstblack playeron
the New YorkYankee'sroster.)
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616
Andrew Hanssen
7I
4
3
2
g
1950
1955
1960
1965
1970
AL
At
7
1975
1980
1985
NL
I
Braves;Pirates
Giants0
Reds@
Dodgers*
Phillies,
k-X
Indians
Dpodgersg
Cardinals
Cubs
Braves
, "
Reds
Giants0
Cubs
Phillies
Dodgers0
4-
.
Braves
X RedSox
Cardin
Pirates
Reds*
3
WhiteSox
m
Twins
XA's
Tigers
Yankees
WhiteSox
Indians
Indians
XTigers
--./A's;
WhiteS
X Yankees
X
1Phillies
- ?
X
Twins
orioles
A TotalNationalLeagueAverage
X RedSox
Oioes
TotalAmerican
LeagueAverage
* NationalLeagueTeamAverages
-ankeo
X
0
Red Sox
X AmericanLeague Team Average:
Tigers
1950
1955
1960
1965
1970
1975
1980
Figure 2a. Average numberof black playersper team (AL vs. NL). 2b. Averagenumberof black playersper team (fiveyear averages)(does not include pitchers).
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The Cost of Discrimination
617
concern was to justify baseball's continuedexclusion of black ballplayers.34To the degree that
AL and NL owners differed,it was that the more racist among the NL owners eitherhiredblack
players anyway (eventually, at least), or got out of the game. They couldn't afford not to. A
graphic example was the PhiladelphiaPhillies. The last NL team by several years to sign a
black player, the club suffered througha mostly dismal 10 years after finishing first in 1950.
When asked why his team had managed to win only one pennant in the decade, their star
outfielderRichie Ashburnreplied, "We were all white." Philadelphiafinally got the message,
began hiring black players in largernumbersin the 1960s, and nearly won the pennantin 1964.
On the otherhand, Fred Saigh of the NationalLeague Cardinalsreportedlyswore never to place
a black player on his team's roster,and never did. However,he sold the team to Gussie Busch
in 1953, who quickly began to sign black prospects.35
Given racist owners in both leagues, a more promising avenue of inquiry may be the
second possibility, that AL and NL fans differed in their preferencesregardingblack players.
If all fans like winning teams (a plausible assumption)and some fans (at least) dislike watching
black players play, the signing of a black player will have two effects on attendance:the team
wins more, so attendanceincreases, and the lineup becomes blacker,so attendancedecreases.
It has alreadybeen demonstratedthat more blacks on the rostermeans more wins in a way that
does not differ significantly between the two leagues. The question now is whether there is
evidence that American League fans had a strongeraversion to black players than National
League fans.
I will estimate the relationshipbetween the number of black players on the roster and
attendance,using a specification developed by Noll (1974). The controls include population
(expected coefficient positive), per capitaincome (expected sign uncertaindependingupon how
differencesin such things as education,industrialstructure,and region are reflected),the "newness" of the stadium(expected coefficient positive),36the numberof star players on the roster
(expected coefficient positive),37 involvementin a pennantrace (expectedcoefficientpositive),38
the amountof "entertainment"competitiona team faces (expectedcoefficientnegative),39recent
first place finishes (expected coefficient positive),40games behind firstplace at the season's end
(expected coefficient negative),41 and the percentageof the populationthat is black (expected
coefficient negative). One variablethatit is unfortunatelyimpossible to obtainfor the full period
34The acknowledgedobjective of the steering reportwas not to promotethe hiring of blacks, but "to protectbaseball
from chargesthat it is fosteringunfairdiscriminationagainstthe Negro" (Tygiel 1983, p. 81).
35Saigh's decision to sell may have been influencedby the fact that he was sentencedto a federal penitentiaryfor tax
evasion. Interestingly,Halberstam(1994, p. 57) maintainsthat new owner Busch's desire to sign black players was
driven in large partby his concern for beer sales; he owned AnheuserBusch, makerof Budweiser."Since Budweiser,
its executives believed, sold more beer to black people thanany otherbeer companyin the country,Busch was nervous
for economic reasons about owning a lily-white team. He could easily visualize a black boycott of his beer."
36I follow Noll in calculatingthis variableas 11 minus the age of the stadium,and zero for stadiumsolder than 11 years.
37In an attemptto be as objective as possible, I calculate this variableas the numberof players who made that year's
All-Starteam.
38The variableequals one if the team finishedin first place or within five games of first place and zero otherwise.
39Sports entertainmentcompetitionis capturedby including the numberof major sports franchises-baseball, football,
basketball,and hockey-in each city. Populationand income providerough proxies for other entertainmentoptions.
40The variableequals two if a pennantwas won in the previousfour years and one if a pennantwas won between five
and nine years earlier.(When Noll [1974] enteredthe two as separatedummy variables,he discoveredthe coefficient
on the formerto be twice that on the latter-see footnotes to his table 1, p. 121).
41 Noll experimentedwith numberof games back at varioustimes duringthe season and concludedthatthe year-endtotal
worked best. He attributedthis to the fact that a disproportionatelylarge share of baseball attendanceoccurs toward
the end of the season.
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618
Andrew Hanssen
is ticket prices. I will thereforenot be estimatinga true demand function, but a reduced form
equation. I make the assumptionthat profit-maximizingprices are chosen;42the estimatedparametersthereforeindicate the change in the profit-maximizingquantityfor each unit change
in the exogenous variables.
Because the data consist of a cross-sectionaltime series, several variablesnot used by Noll
will also be included to control for factors that changed over time. These are dummy variables
indicatingmovement to a new city (expected coefficient positive), stadiumcapacity (expected
coefficient positive), the numberof competing baseball franchisesin the SMSA (expected coefficient negative), and a dummy variable equal to one where teams played 162 games-the
schedule was increased from 154 to 162 games midway throughthe sample period (expected
coefficient positive). Finally, the numberof black playerson the rosteris enteredas the primary
variable of interest.43If fans preferredwhite players to black players, all else equal, the effect
of thatlast variablewill be negative. The magnitudeand significanceof the estimatedcoefficient
will give evidence as to the importanceof that effect.
The period consideredis 1954-1972, when the differencebetween Nationaland American
league hiring of black players was strongest. Summary statistics are shown in Table 4. The
estimates from the equation are displayed in column 1 of Table 5 (first-orderautocorrelation
and heteroscedasticitycorrectedfor) and are generallyas expected.The coefficienton population
is positive and statisticallysignificant-teams in largercities indeed appearto attractmore fans.
Higherper capita income, newer stadiums,more All-Stars, involvementin a tight pennantrace,
a recentpennant,a largerstadium,and a new city all bringmore fans to the game, as anticipated.
More games out of first place, a greaterpercentageof Black population,and the presence of
anotherteam in the same SMSA are all associated with lower attendance.These results are
generally consistent with Noll's estimationfor the 1970 and 1971 seasons.44Most pertinentto
this analysis, the coefficient on the numberof black players term is negative and statistically
significant at well under 1%. Controllingfor other factors, each black player appearsto have
lost his team nearly 10,000 ticket buyers per year, a little less than 1% of the average team's
annualattendanceover the period in question.45
Did AL and NL attendancerespond to black players differently?Likelihood ratio tests
indicate that pooling the data from the two leagues is appropriate,except with respect to two
variables:the numberof players who are black and the percent of the SMSA'spopulationthat
is black. AL versions of these two termsare createdby interactingan AmericanLeague dummy
with each. The AL dummy is included in the estimationas well.
The results are shown in column 2 of Table 5. The coefficient on the AL black players
interactionterm is negative and statistically significant at 5%, indicating that AL fans react
42
Whetheror not the owner values team profitsmore than winning, it seems reasonableto assume that ticketprices (as
opposed to spendingon players,for example) will be set so as to maximizeprofits.
43 Results of a Waldtest indicatethat startersand substitutesshouldbe groupedtogether(WaldStatistic= 4.1, p = 25%).
44One difference is that Noll found a negative coefficient on per capita income, whereas this analysis finds a positive
one. The differencemay result from my having left out ticket prices, or because several teams switchedcities during
the period.A simple time trendand a NationalLeague dummyvariable(the NL had higherattendanceover the period
thanthe AL) were also includedand found to have no materialeffect on the magnitude,signs, or statisticalsignificance
of the coefficient estimateson the other variables.
45A similareffect was found by Scully (1974b), who estimatedthateach black startingpitcherlost his team nearly2,000
fans in 1967. The effect of including individualdummy variables for the first throughfifth black players was also
investigated.No clear patternof differentialfan reactionto the first, second, third,etc., black playerwas revealed,and
likelihood ratio tests indicatethat the linear approximationis a betterfit.
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The Cost of Discrimination
619
Table 4. SummaryStatistics for Variablesfrom AttendanceEquation
Mean (StandardDeviation)
Attendance
Population
Per CapitaIncome
StadiumNewness
All-Stars
PennantRace
Sports Competition
Recent Pennant
Games Back
Percent PopulationBlack
StadiumCapacity
New City
Other Baseball Team
Number of Games (Dummy Variable)
Number of Black Players
Combined
American
League
National
League
1133.5
(429)
3861.6
(2974)
0.8117
(0.256)
1.819
(3.40)
2.924
(1.62)
0.2401
(0.428)
2.526
(1.38)
0.9145
(0.908)
15.95
(12.7)
0.1295
(0.055)
45.44
(13.0)
0.0230
(0.150)
0.2237
(0.417)
0.6053
(0.490)
3.747
(2.19)
1059.6
(342)
3916.5
(3192)
0.8288
(0.263)
1.388
(2.95)
2.901
(1.71)
0.2237
(0.418)
2.533
(1.54)
0.7961
(0.916)
18.01
(13.9)
0.1343
(0.065)
50.20
(14.3)
0.0263
(0.161)
0.2697
(0.445)
0.6316
(0.484)
2.947
(1.83)
1207.4
(491)
3806.8
(2750)
0.7947
(0.248)
2.250
(3.77)
2.947
(1.53)
0.2566
(0.438)
2.520
(1.20)
1.033
(0.887)
13.90
(11.1)
0.1247
(0.043)
40.68
(9.27)
0.0197
(0.140)
0.1776
(0.384)
0.5789
(0.495)
4.546
(2.23)
significantlymore aversely to black players on the roster than NL fans do. The point estimate
implies that the marginalblack player on an AL team cost 9213 more attendeesper year than
he would have on a NL team (nearly 1% of annualattendance),despite the fact that he would
produce the same amount of additionalwinning for either. The coefficient on the AL percent
black population interactionterm is negative as well, and statistically significant at less than
1%. Its magnitudeimplies that a one percentagepoint increase in the local black populationis
associated with 5,612 "fewer" fans in the AL versus 26,000 "more" fans in the NL.
In short, the teams of the American League appearto have lost significantlymore fans
with each black player placed on the roster than did those of the National League.46 Fewer
black players were hired by AL teams, accordingly. And given this laggardly hiring, the AL
drew fewer fans in areas with large black populations.
These findings are consistent with a "theory" that has floated aroundbaseball for many
46 The between-leagueattendancedifferencesare robustto
the inclusion of fixed effects.
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Andrew Hanssen
Table 5. The Effect of Black Players on Attendance(1954-1972)a
Constant
Population
Per CapitaIncome
StadiumNewness
All-Stars
PennantRace
Sports Competition
Recent Pennant
Games Back
PercentPopulationBlack
StadiumCapacity
New City
Other Baseball Team
Numberof Games (Dummy Variable)
Numberof Black Players
(1)
(2)
882.2***
(38.8)
0.042***
(0.004)
95.66***
(8.27)
47.35***
(1.33)
41.55***
(1.68)
17.46***
(6.65)
-3.412
(5.74)
72.10***
(5.19)
-8.994***
(0.369)
-214.67**
(116)
0.342
(0.744)
153.9***
(16.7)
521.54***
(87.3)
0.040***
(0.004)
49.85***
(11.9)
44.23***
(1.55)
40.25***
(1.68)
21.98***
(6.51)
-26.02***
(7.23)
71.06***
(5.20)
-9.239***
(0.387)
2649.9***
(534)
1.379*
(0.807)
156.3***
(16.2)
(22.0)
7.963
(21.7)
-9.903***
(1.90)
(25.6)
-14.64
(23.0)
-5.771**
(2.45)
432.55***
(91.8)
-9.213**
(4.14)
-3212.0***
(562)
0.539
- 159.7***
AL Dummy Variable
AL Numberof Black Players
AL PercentPopulationBlack
R2 b
0.537
- 100.7***
variable:
attendance
304. Significant
at *** 1%,**5%,and* 10%.
Dependent
('000);numberof observations:
bR2calculatedfrom correlationbetween fittedand actualvalues of dependentvariable.
a
years, thatthe leagues specialized,the AL in whiterline-ups and the NL in higherqualityplay.47
There are many anecdotes to support this idea. For example, Jane Pittman, Ernest Gaines'
eponymous fictional heroine, says, "Jackie and the Dodgers was for the colored people. The
league certainlymakes more sense than specializationby team within leagues: a team that did not
integrateas fast as its other-leaguerival did not lose any more often than it had previously,but a team that did not
integrate as fast as its own-league opponent did. If the failure to achieve potential wins is not as onerous as the
productionof actualdefeats(see AlchianandDemsetz [1972], footnote 15, for a shortdiscussionof relativeperformance
in sports),then each team will have to keep an eye on the others,because no single team can affordto departtoo far
from the league average withoutpaying the price.
47 Specializationby
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The Cost of Discrimination
621
Yankees was for the white folks" (quoted in Tygiel 1983, p. 294). Roger Kahn quotes an
unnamed Yankee executive who claimed that the Yankees would never sign a black player
because "It would offend box holders from Westchesterto have to sit with niggers."48Jim
Bouton's (1981, p. 65) comment on how the play of Frank Robinson (an African-American
outfielderwho moved from the National League Reds to the AmericanLeague Orioles in 1966)
disconcertedhis Yankees shows that National League baseball was recognized as differentand
superior:"This was NationalLeague play and the Yankeessimply weren'tused to it." Similarly,
Halberstam(1994, p. 5) asserts that National League attendanceoutstrippedAmericanLeague
attendancein the 1960s, "in part because the National League players were more exciting to
watch."
The evidence indicates that National League quality of play was better.Interleaguecompetition occurs only twice per year, once in the World Series and once at the midseason AllStarGame. AmericanLeague teams (primarilythe New YorkYankees)won seven of nine World
Series from 1946-1954. The following four Series were split evenly. National League teams
then proceededto win eight of the next eleven contests before performanceevened again in the
1970s. With respect to All-Star Games, the difference was even more dramatic.Until the latter
half of the 1970s, NL All-Star teams included many more black players than did AL All-Star
teams.49 The game results were as one might expect. Between 1950 and 1980 the National
League won 29 out of 36 contests (several years saw two games played), including 12 of 13
(not counting one tie) in the 1960s.
Whether AL fans were more racist throughoutor whether fans switched favorite teams
after the color barrierwas broken remains an open question. Certainlynothing in the demographic makeup of league cities would have led one to predict that the AL would emphasize
"whiteness." There is no evidence of statistically significantdifferences between AL and NL
cities in population,per capita income, black population,or the percentageof the population
that is black for any period from 1950 onward.50 Regional distinctionsdo not explain why the
AL should have integratedmore slowly either.As of 1950, the closest to "southern"baseball
cities were Washington,D.C., which, as the nation's capital, was not a true Southerncity, and
St. Louis and Cincinnati,which were both considered "bordertowns"---each remainedsegregated throughoutmuch of the 1950s. Indeed, St. Louis Cardinalsowner Fred Saigh justified his
club's refusal to sign black players by saying, "I think we were thought of as a team for the
South." (Tygiel 1983, p. 286) However, Cincinnatiand St. Louis were both National League
clubs. The AmericanLeague did place a team in Baltimore in 1954, but the Orioles were not
the AmericanLeague laggardin signing blacks. The slowest pace of integrationwas displayed
by New England'sBoston Red Sox, who did not starta black player until 1965.
In short, neither league had a monopoly on racist owners, a lock on the south, more or
fewer potential black fans, or significantlylarger or wealthieraudiences. Perhapsthe simplest
48 Kahn (1972,
p. 160). Interestingly,althoughthe Yankeeswere one of the last AL clubs to integrate,their owner,Dan
Topping,also owned one of the first football teams to sign a black player.The New YorkFootballYankees'ssigning
of Buddy Young in 1947 sparkedrumorsthat the baseball team would shortlyfollow. It didn't.
49In the 1950s, 1960s, and 1970s, the NationalLeague had three, nine, and nine nonpitchingblack players,respectively,
on the rosteron average,whereasthe AmericanLeague had one, four, and eight, respectively.
50 Comparisonswere made for the census years from 1950 to 1970. The one exception is per capita income in 1970,
which is significantlygreater(at 5%) for AL cities. A probitregressionincludingall variablessimultaneouslyto allow
for cross effects (thoughleaving out populationto avoid perfectcollinearity)also failed to give evidence of significant
cross-leaguedifferences.
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622
Andrew Hanssen
reason why the NL "specialized"in quality and the AL in whiteness ratherthan the otherway
aroundis that the National League just got off to a faster startin hiring black ballplayersand
stayed there. Formermajorleague managerBobby Braganonce explainedit as follows:
You want to know why the NationalLeague is the strongerleague? BranchRickey, he's the answer.... He
signed Robinson.Then he signed Campanellaand Newcombe. Then the other teams in the NationalLeague
got the message .... The AmericanLeague was left holding the sack for a long, long time. (Tygiel 1983,
p. 336.)
A final question-why did the AL eventuallyincreaseits hiring of black ballplayersto NL
levels? The preceding analysis leads one to suspect that changes in fan preferencesmay have
been responsible, and the overall negative association between black players and attendance
indeed weakened over time."' The AL/NL gap in the number of fans scared away by black
players also shrank;however, AL teams continued to lose more fans than NL teams for each
black player on the roster at least through 1972. Nonetheless, the NL/AL hiring gap closed
completely. One can only speculate, but the expandingimportanceof TV revenues may have
played a role. Baseball's income from television and radio increasedfrom $17 million in 1962
to $41 million in 1972 (see Quirkand Fort 1992), a real rate of growth of nearly 6% per year.
Over the same period,attendanceincreasedby less than 1%per year.The TV-relatedbroadening
of baseball'saudienceand the increasedpower of advertisersmay have thus inducedAL owners
to pursue a less parochialhiring strategy.
Substitutes
Because the makeup of the bench largely shadows that of the startinglineup in terms of
positions represented(Table6), in the absence of discrimination(on the partof owners, players,
or fans) one would expect to find the same proportionof African Americans substitutingas
starting.52Indeed, that is what one finds when anotherminorityis considered, "white Latins."
A white Latin is someone of Latin Americanbirth who is sufficiently "white" to have played
major league baseball under the color bar.53Figure 3a looks at the proportionof white Latins
in the startinglineup and on the bench from 1948 to 1984. On average, they are equal. Figure
3b looks at the proportionof black players on the bench and in the startinglineup, and finds
that they are not. Although the growth trend in hiring is nearly identical for black startersand
51 Placing a
single black player on the roster implied a decline in attendanceof nearly 20,000 fans in 1954, versus a
decline of only 2000 fans by 1972. This is consistentwith the findingsof other studies. For example, a negative and
statisticallysignificantassociationbetween revenueand the percentof the rosterthat is black is documentedby Scully
(1974a) when he considersthe 1968 and 1969 seasons. When Sommersand Quinton(1982) use the same approachto
analyze the 1977 season instead, they find that the negative relationshipbetween black players and revenue had
essentiallyvanished.
52It should be noted that black playersare not uniformlydistributedby position, but are relativelymore common in the
outfield and at first base (see, e.g., Scully 1974b). However,the racial disparitybetween startersand substitutesis just
as strongwhen positions are examinedindividually.
53Darker skinned Latins were only permittedto play on presentingpapers attesting to their pure Caucasianheritage
(Tygiel 1983). A total of 27 Latin Americans,primarilyCubansbut also three Mexicans, a Colombian,and a Venezuelan, played for majorleague teams between 1900 and 1940. As when black players were first recruitedby major
league teams, new scoutingoperationshad to be developed,new playerssigned, and a "different"(in this case Spanishspeaking)kind of playermixed with the rest. In a furtherparallelto the black situation,well-developedLatinAmerican
leagues provideda traininggroundfor the best Latin Americanplayers. Applyingthe distinctionto post-1947 players
is somewhat tricky-Tony Perez, the former CincinnatiReds' Cuban great, is judged "Black"; his teammateDave
Concepcion,the Venezuelaninfielder,is judged "White." I relied on the counsel of Dick Clark,Co-Chairmanof the
Negro League Committeefor the Society of AmericanBaseball Research,in categorizingLatin players.
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The Cost of Discrimination
623
Table 6. The Makeupof the Bench and the StartingLineup
StartingLineup
Substitutes(1950-1984)
Outfield
First Base
Infield
Catcher
37.5%
41.6%
12.5%
12.3%
37.5%
31.8%
12.5%
17.5%
black subs (peaking at the same time), throughoutthe entire 35-year period black players are
consistently less well representedon the bench.
To explain the difference in hiring levels, I returnto the effect that excluding blacks had
on winning and attendance.I will startby reestimatingthe relationshipbetween black starters
and winning with the deviation from the league mean in the number of substitutes who are
108
I
6
c4-4
1946 1950 1954 1958 1962 1966 1970 1974 1978 1982
Starters
-
Substitutes
50-
40,
30-
S20
0
1950
i
1955
•~
1960
Starters
1965
1970
-
1975
1980
1985
Substitutes
Figure 3a. White Hispanic startersversus substitutes.3b. Black startersversus substitutes(does not include pitchers).
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624
Andrew Hanssen
Table 7. Effect of Black Startersand Black Substituteson Winninga
Constant
NormalizedDeviation Black StartersInstrument
NormalizedDeviation Black StartersInstrumentSquared
(1)
(2)
0.502***
(0.006)
0.024***
(0.008)
-0.013
(0.008)
0.502***
(0.010)
0.130***
(0.021)
0.024*
(0.013)
-0.040***
InteractionWith League Mean (starters)
(0.008)
Interactionwith League Mean Squared(Starters)
NormalizedDeviation in Black Substitutes
NormalizedDeviation in Black SubstitutesSquared
-0.003**
(0.001)
-0.004
(0.006)
-0.001
(0.002)
0.001
-0.001
(0.002)
-0.001
(0.001)
InteractionWith League Mean (Substitutes)
(0.003)
InteractionWith League Mean Squared(Substitutes)
0.000
(0.0003)
0.094***
(0.021)
-0.192**
(0.009)
0.100
Population
Per CapitaIncome
R2 b
aDependent
* 10%.
variable: percent games won; number of observations:
560. Significant
0.371***
(0.114)
-0.218***
(0.052)
0.120
at *** 1%, ** 5%, and
bR2 calculated from correlation between fitted and actual values of dependent variable.
black (and the various transformationsthereof) included as additionalexplanatoryvariables.
The evidence of simultaneityis much weaker with respect to substitutesthan it is with respect
to starters;a Hausmantest fails to reject the null hypothesis of no simultaneitybetween black
substitutesand winning at the 65% level. The estimation will thereforeinstrumentfor black
startersas done above, but will not instrumentfor black substitutes.54
The results are shown in
Table 7. The coefficients on the black startersterms remain roughly as before, whereas those
on the substitute terms are tiny (about 5% the size of the starter'sterms) and statistically
insignificant.Black startersimprovedwinning in an importantway, black substitutesdid not.
Did black startersand substitutesaffect attendancedifferently?The previous estimation
(shown in Table 5) grouped all players together,which a Wald test indicatedwas appropriate.
That would suggest that the mere presence of a black substitutedeters as many fans from
attendingas that of a black starter.Even if one allows the coefficients on startersand substitutes
to vary (estimationnot shown), the difference implied is slight: the first black starterloses his
team 12,000 ticket buyers versus 10,000 chased away by the first black substitute.
A black substitutethus has a lesser (positive) effect on winning than a black starter,and
an approximatelyequal (negative) effect on attendance.However, that attendanceeffect (indicated by the coefficients on the numberof black players variablein Table 5) simply measures
the impact of the player's "blackness" on fan turnout;it does not count any othercontribution
54The results are qualitatively equivalent if black substitutes are instrumented for as well.
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The Cost of Discrimination
625
that the player makes. Table 5's estimation suggests that each game out of first place costs a
team 9000 attendees.The coefficients shown in column 2 of Table 7 suggest that on average,
between 1954 and 1972, one black starterabove the league mean was worth about seven additional wins per year. That translatesinto a reduction of nearly eight in games out of first
place.55A black starteris thereforeassociated with an increase in winning sufficient to attract
an additional69,000 fans, more than enough to offset the effect of his skin color. And this still
ignores such potential contributionsas his making the team a contender(worth 17,000 fans),
or even a pennant winner (worth 72,000 fans), as well as the possibility that he was an AllStar (worth 41,000 fans). In contrast,as Table 7 shows, a black substituteproduced no measurable effect on winning and was unlikely to have been influential in bringing his team a
pennantor to have made the All-Star team.
In short,the increasedwinning was less and the attendanceforfeited the same when black
substitutesratherthan starterswere hired. One would thus expect to have found fewer blacks
on the bench than in the startinglineup, and that is exactly what one finds. The fact that the
average (or worse) black player may be treateddifferentlythan the star has been noted, and is
usually attributedto owners' distaste for black ballplayers.56A plausible alternativeexplanation
is succinctly expressedby player agent Bob Wolf: "Remember,this is an entertainmentindustry
.... (Owners) might pay a little extra to put a white player on the bench" (quotedin Johnson
1992, p. 190).
Whatabout Owner Preferences?
So is this to say that baseball owners were respondingsolely to fan preferenceswhen they
did or did not hire black ballplayers?Not necessarily.As the numerousanecdoteshave indicated,
baseball executives were remarkablyopen abouttheir dislike of black people. And furthermore,
althoughthe National League was the "progressiveleader" in the startingof black ballplayers
(see Figures 2a, b) where substituteswere concerned, the story was different.The analysis of
the previous section suggests that a primaryreason why NL black hiring outstrippedAL black
hiring until the 1970s was that strongerdeclines in attendancewere associated with black AL
ballplayersthan with black NL ballplayers.If fan preferenceswere the only story, one should
find then that NL teams carriedmore black substitutesthan AL teams. Indeed, given the between-league differentialin starters,one would expect it; future startersare seasoned on the
bench and exstartersfinish their careers there. However, as Figure 4 shows, that was not sothe average NL team carried the same number of black substitutesas the average AL team
between 1950 and 1984 (comparethis to Figure 2a). Even teams like the Dodgers and Giants,
who for many years topped baseball in the startingof black players, did not tend to keep more
black substitutesthan theirrivals. In fact, over the entire35-yearperiod,the correlationbetween
number of black ballplayersin the startinglineup and number on the bench for all teams is
only 0.39 (and only 0.24 after 1954 and 0.12 after 1959). The fact that owners indeed appear
55Each win reduces games back by approximately1.1 on average. If the victory is against the league leader,you gain
two games and if it is againstanotherteam, you gain one game, in both cases versus where you would have been had
you lost. Assuming eight teams per league (true until 1960), the average is 1.125 per win. As the numberof teams
increases,the value of a win in terms of its effect on games back shrinksslightly but must always be greaterthanone.
56A typical example is Jiobu (1988, p. 532), who investigatedthe effect of race on careerdurationand discoveredthat
once a player's performance,age at entry, and position are controlled for, ". . . the net effect of being black is to
increase career mortality."He explained this is due to the fact that "managementhas silently placed an 'invisible
ceiling' on the black percentage."
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626
Andrew Hanssen
3.5
3
2.5-
2
1.5-
0.54
A
i.4i
1950
1955
1960
1965
1970
1975
--
AL
--
NL
1980
1985
Figure 4. Average numberof black players on bench (AL vs. NL) (does not include pitchers).
to have respondedto the preferencesof their customers (as one would expect), does not mean
that their own discriminatorytastes were never indulged.
4. Conclusion
This articlehas attemptedto determinethe effect of competitiveforces (the desire for wins
and profits) on discrimination(the exclusion of black players). It finds a large, positive, and
statistically significant association between black players in the startinglineup and winningteams that failed to startblack players lost significantlymore often. This differentialappearsto
have been sufficientto ensurethe black playera place in majorleague startinglineups.However,
for more than 20 years, the AmericanLeague trailedthe NationalLeague in black hiring.Given
that the effect of a black player on winning was the same in each league, that differencemay
best be attributedto differences in fan preferences. Controlling for a number of potentially
relevant factors, each black player on the roster is associated with a significantlygreaterdrop
in attendancein the AL than in the NL.
Between-league differences are not the only evidence of disparate racial treatment.
Throughoutthe entire 35-year period, the proportionof black players on the bench was significantly lower than in the startinglineup. In general, fans appearto have found black players
equally untenable as startersand as substitutes-each is associated with approximatelyequal
declines in attendance-and black substitutes were significantly less able to compensate by
improvingthe won-loss record.The moral of the story is thatif a playeris good-good enough
to start-the team (and its fans) can not afford to shun him. If a player is not so good (a
substitute) the price paid for discriminationis lower. Not surprisingly,it appears that more
discriminationoccurredwhere it cost less.
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The Cost of Discrimination
627
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