The Effect of Foreign Players on Pay and Performance in Major League Soccer

Simon Medcalfe and Rebecca Smith

Over the last ten years, Major League Soccer (MLS) has attracted many overseas players. This study examines the role country of birth plays in salary determination, team performance on the pitch, and fan attendance in Major League Soccer for the 2007 through 2014 seasons. Players born in the U.S. earn less than equally productive foreign-born players. However, there is much heterogeneity amongst these foreign-born players. Players born in France, Gambia, Argentina, Brazil, Columbia, and Costa Rica earn salary premiums relative to their productivity. Players born in Trinidad and Tobago earn less than their productivity would suggest.  There is little evidence that foreign born players impact team performance on the pitch but may have a positive effect on attendance.