NBA study: Teams with larger pay gaps among core players win fewer games

NBA teams with unfair pay gaps lose more games

New research shows that NBA teams with larger salary differences among their core players win fewer games. The study, published in the journal Human Performance, found the problem isn't a lack of effort, but a breakdown in cooperation and coordination.

“For a team, it’s more than just effort, it’s also coordination,” said lead author Jeremy Beus, a professor at Washington State University’s Carson College of Business. “Merely working hard does not necessarily help the team. It needs to be coordinated effort.”

The problem is in the strategic core

The research focuses on a team's "strategic core"—the members most critical to problem-solving and coordination. In the NBA, this was defined as the five players who logged the most minutes.

The authors argue pay inequity within this core group carries unusual weight. When central contributors feel underpaid compared to peers in similar roles, perceptions of unfairness can quickly erode trust and collaboration.

“If the variability in pay is based on variability in performance, there’s no reason for anyone to feel there is unfairness,” Beus said. “If LeBron James makes more than me as a guy on the bench, I obviously expect that.”

How the study worked

Researchers analyzed NBA data from the 2009–2010 through 2019–2020 seasons. They measured team success by winning percentage and used defensive rating as an indicator of cooperation and coordination.

After controlling for total payroll, talent, and other factors, a clear pattern emerged. Teams with greater pay inequity among their core players performed worse. This was linked to poor coordination, not a lack of collective effort like rebounding.

The study's key metrics included:

• Winning percentage (success)
• Defensive rating (coordination)
• Rebounding & loose balls (effort)
• Salary differences among top 5 players

Why past research has been mixed

The findings help explain why previous studies on pay inequality have had conflicting results. Some theories suggest large pay gaps motivate competition, while others argue they damage morale.

This study suggests both can be true depending on who experiences the gap. Pay differences among peripheral players had a weaker relationship with performance. Perceived fairness, not inequality itself, drove outcomes.

“Alignment between pay and contribution also mattered,” Beus noted. When compensation differences reflected clear performance differences, negative consequences were less pronounced.

Lessons for every workplace

The researchers point to clear parallels in corporate settings, especially regarding salary compression. This occurs when new hires are paid more than long-time employees in similar roles, leaving experienced workers feeling undervalued.

“Think about how you’re paying people,” Beus advised. “If you don’t address salary compression, then you may have discontent and people may be more inclined to leave.”

The broader implication is that organizations must pay close attention to compensation among employees who coordinate work and influence outcomes. Simply increasing budgets doesn't guarantee better results if fairness perceptions deteriorate.

What managers should do

The study suggests managers should focus first on fairness among employees in critical, coordinating roles. Pay inequity here may cause disproportionate harm.

Practical steps include:

• Reviewing compensation structures for alignment with contribution in high-impact teams
• Clearly communicating how pay decisions are made to reduce misunderstandings
• Implementing team-based incentives that emphasize shared success

The research has limitations—it's observational and sports differ from typical workplaces. However, the longitudinal data and controls strengthen confidence in the patterns.

The central finding remains clear: cooperation depends on fairness among the people who matter most. How compensation is distributed within a team's core can determine whether talent works together smoothly or pulls apart.