What Can Cricket Data Tell Us About Labor Luck?
In a new paper, Shekhar Aiyar and Rodney Ramcharan use international cricket data to examine the role of luck in labor market outcomes. They find that “a player’s debut performance is strongly affected by an exogenous source of variation: whether the debut series is played at home or abroad.” The authors also find that first game performance has a “large and persistent impact” on cricket players’ careers over the long run as well, in part because management uses information inefficiently. In other words, luck (in this case, making one’s debut at home instead of away) affects cricket players’ careers over both the short and long term. The authors caution against generalizing their results, but do suggest that “luck might figure more widely in labor market outcomes than commonly believed.” [%comments]