The Cost of Forgoing Status Rewards: Major League Baseball Teams and the Free Agent Market

Le résumé fourni par la source

Status provides organizations with privilege rewards including being able to gain discounts on resources. However, if organizations take advantage of status rewards, there is a risk of status loss based on the external perception of lower quality. The study asks if organizations will seek to take advantage of available status rewards or if the goal of status accumulation will predominate. Using a sample of Major League Baseball (MLB) free-agent contract signings, this study finds that high-status teams pay more for resources than their lower-status counterparts, regardless of the quality or status of the players. Implications for researchers address the cost of status may be ignored based on status goals, while practitioners can understand how the quest social approval may be driving up the cost of their resources.

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