Abstract

This paper is concerned with the economic incentives of crime among agents within a private organization. Specifically, we present a contest model of a college basketball game to identify the winners, losers, and social welfare consequences of point-shaving corruption in men’s NCAA basketball as an example of participation in illicit activities. It is shown that, under reasonable conditions, such activities lower the level of social welfare derived from college basketball play by reducing aggregate efforts in a game and distorting relative efforts across teams. We then examine the economic incentives of a player to point-shave and discuss player-types that are at a relatively high risk of engaging in point-shaving corruption. Private and public mechanisms to minimize corruption are compared in terms of efficiency, and a differential “honesty premium” is derived and discussed as an efficient way for the NCAA to decrease the incidence of player corruption.

Submitted: December 12, 2007 · Accepted: December 16, 2008 · Published: May 13, 2009

Recommended Citation

Chang, Yang-Ming and Sanders, Shane D. (2009) "Corruption on the Court: The Causes and Social Consequences of Point-Shaving in NCAA Basketball," Review of Law & Economics: Vol. 5 : Iss. 1, Article 12.
DOI: 10.2202/1555-5879.1244
Available at: http://www.bepress.com/rle/vol5/iss1/art12