The Myth of Collegiate Athletics

With the most recent study out that states that full-ride scholarships don't actually pay for all collegiate expenses, I thought it was high time to castigate the NCAA. 

First of all, let's discuss the myth that collegiate athletes are amateurs - that they are not paid to play athletics.  Most notably, this myth goes hand in hand with the argument that a college education is priceless.  Both arguments are without merit.  First, of course, college athletes are paid to play - they receive scholarships from the institutions they play for.  That scholarship (which is considered income by the IRS*) is an actual dollar amount going from the college to the player.  In other words, every school pay its players.

Now yes, an education is an investment in the future, but that doesn't make education priceless.  In fact, every year, every college and university throughout the country puts a price tag on the value of their education.  That price tag is called "tuition."  And said tuition is paid by every non-scholarship student, either through their parents or through loans.  By the way, that price is the price just to attend the storied institution, and does not include costs for books, living expenses, etc.  In other words, USC does, in fact, pay its players more than UCLA, because the tuition costs to go to USC are much, much higher.

Because this is entirely obvious, and because the value of some players is much, much, higher than others, some college athletes, acting as economic actors, actually seek additional compensation for their services.  We castigate these players for either cheating, or being greedy, but let's face it, they are acting rationally.  In fact, given that many collegiate players lack the skills to play in the pros effectively, and that injuries are so common, I would argue that it is more rational to take money under the table than to not.

And here I come to one of my major rules - people are going to do what is perceived to be more rational economically speaking, than they are going to do what is considered more moral.  Moreover, the market will modify and change itself to eliminate an obvious inefficiency (as opposed to an obscure inefficiency or an externality).  Here, everyone knows college athletes are paid for their services (tuition), and everyone knows that in a few select sports (football, basketball), the star athletes are grossly underpaid.  This is especially true when it comes to basketball, where 1-2 stars can make the difference between going to NCAA Tournament (and getting the school to rake in hundreds of thousands of dollars), and not.

So, let's not kid ourselves, collegiate athletics is professional athletics.