The income tax rate effect varies by league, with the largest effect in professional basketball, where teams in states without income tax win 4.5 more games each year relative to high-tax states.
Friday, April 21, 2017
Sports teams do better in states without income taxes
In theory, one would expect higher after tax salaries to attract better players. The forces behind this are the same that lead to compensating differentials in labor markets. Evidence supports theory: