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Study explores professional athletes’ contract-year performance

The study is called “The contract year syndrome in the NBA and MLB: a classic undermining pattern.”

Jan. 29, 2014

Sports enthusiasts are no stranger to the effects of a contract year.

In hopes of landing bigger, better deals with teams – complete with fame and fortune – it is common for athletes to play to their full potential during the last year of their contract, and then often falter the following year.

Seeking to back up this “contract year effect” with psychology, senior Mark White researched professional sports trends for his honors capstone project, published in the journal Motivation and Emotion.

After comparing contract-year statistics from National Basketball Association and Major League Baseball players, White and psychology professor Ken Sheldon have proven the existence of both the contract-year rush and the subsequent decline in athletic performance.

“According to self-determination theory, a big, salient extrinsic motivator like (a contract), can actually undermine motivation if it meets certain conditions,” White said. “It's been shown that it can undermine performance. I thought a contract year was something that came up naturally that could be looked at.”

Extrinsic motivators can be anything from the promise of money to the potential fame of landing a big contract. On the other hand, intrinsic motivators stem from personal enjoyment and doing something for inner fulfillment.

White compared player statistics that spanned over three years to find trends: the year before a contract year, the contract year itself and the year following a contract year. Crediting the effects of extrinsic motivators, White found that in the following year, players not only performed worse than during their contract year, but the year before as well.

“With baseball, in the contract year, nothing went up,” White said. “We measured batting and offensive production in a bunch of different ways, so the amount of RBIs or home runs or batting average (or) on-base percentage. All of that stayed the same in the contract year but still dipped off (the next year).”

This trend can be seen in MLB players such as Josh Hamilton of the Los Angeles Angels. Hamilton, who was a free agent after his contract with the Texas Rangers ended, signed with the Angels in 2012.

The five-year contract earns him $125 million, $20 million of which goes to charity. Despite having more at-bats with the Angels, his runs went down from 103 to 73, along with an RBI decrease of 128 to 79.

From a sports management standpoint, however, other factors need to be taken into consideration, sports management teaching assistant professor Nicholas Watanabe said. Statistics depend just as much on team quality as they do on individual skill.

“Lebron James doesn't have to score 60 points a night now that he's with the Heat, because he has other players that are really good around him,” Watanabe said. “Kevin Durant might have to score 50 points every night … Statistics can go down, but it doesn't necessarily mean players are underperforming or not doing as well.”

In addition, fans must realize that contracts reflect not only skill level, but the amount of money a player is able to bring to a franchise, Watanabe said.

“We have to consider that sometimes players are signed not because they're going to perform well on the field, but because they'll perform well in terms of marketing and revenue,” Watanabe said. “So we also look at things like how much money they'll be able to generate.”

Nonetheless, White said studying the influence of intrinsic and extrinsic motivation helps explain performance levels in all areas of talent, whether they be athletic or artistic.

“I think it's good to think about why you're motivated to do something and think about how the conditions around you can influence how you play,” White said. “If you give someone money — an extrinsic motivator — then they can enjoy something less and perform worse at it.”

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