Home Mentoring HBR.org The Real Reason Baseball Players Make So Much Money

The Real Reason Baseball Players Make So Much Money

HBR.org 2012-10-24

Almost 10 years ago, Roger Martin wrote a short essay for HBR called "Capital Versus Talent." I read it for the first time in 2009 and had to double-check the date of publication. It seemed to describe 2009, not 2003. And when I went back and read it again, not long ago, it seemed to describe 2012 even better.

I love Martin's writing, because he has a real gift for reframing problems and issues, and in "Capital Versus Talent" he argued that a paradigm shift had occured somewhere around the mid-1970s. The 20th century was chiefly about the struggle between Capital and Labor — and Capital won in the end. But the last 35 years, Martin said, have been about a wholly different battle. Those at the top of competitive professions — Talent — have become dramatically more aggressive (and successful) in getting paid by the institutions and clients they work for. Professional baseball players used to work in car dealerships in the off-season. Now they own the car dealership.

It was only after reading Martin's article that I truly felt I understood the dramatic rise in income inequality of the past few decades. It didn't happen by accident or because of some nefarious conspiracy. It had to do with a reordering of the social contract. I ended up writing a piece on this idea for the New Yorker called "Talent Grab." It has my name on it. But don't be fooled. It's really by Roger Martin. _____________________

HBR's 90th Anniversary: Why Management Matters

More >>