The global labor market for soccer players : Examining wage differentials between natives and immigrants in Sweden

Abstract: This essay studies wage differentials between foreign born and native players in Swedish soccer. For this essay, panel data for the years 2001-2015 on all clubs and players in top Swedish soccer leagues Allvenskan and Superettan have been collected. The data is examined by applying a market-test approach to test for any significant wage differentials. The results show that foreign born players earn a significant salary premium compared to native players of similar productivity. There is no evidence of salary or fan discrimination against foreign born players. Results can be explained by market imperfections and/or risk-seeking behavior from team managers although this could be further investigated in future studies.