Superstars and talent

Superstar salaries aren't just a big reward to talent. That's the message of this paper (pdf) by Egon Franck and Stephan Nuesch.
They studied the influences upon the market value of players in the Bundesliga. They found that whether a player had a personal webpage was more than three times more important for his value than whether he played for his national team. What's more, goals and assists are insignificant influences upon market value, whereas the number of page returns from Google, and the number of press mentions, are significant.
This corroborates Olivier Gergaud and Vincenzo Verardi's study (pdf) of the prices of Pokemon trading cards, which found that prices are not related to observable characteristics. Both vindicate Moshe Adler's view of the emergence of superstars, against Sherwin Rosen:

There are many artists who possess stardom-quality talent. What produces superstars...is the need on the part of consumers to consume the same art that other consumers do. This need arises from the fact that the consumption of a piece of art is not a momentary experience but a dynamic process in which “the more you know, the more you enjoy.” Consumers build “consumption capital” in art, and the larger the capital the greater is the enjoyment from each encounter with the art and the artist...
The star emerges from among several artists who are all equally talented. Obviously, talent cannot be the determining factor in this process. Instead, consumers select an artist at random when they add a new artist to their consumption basket. It is simply by pure chance that one of these artists ends up with more patrons than the rest.This initial advantage makes the lucky artist the most popular, and since consumers prefer popular artists, other consumers will switch to her as well. An initial advantage can thus snowball into superstardom. 

All this suggests that mega-salaries might not be economically efficient. More importantly, it suggests the money launderers paid well over the odds for Michael Ballack. 

Comments

[tom s.]

how do you find these things?

[james higham]

I was going to make Tom's comment above. ...It is simply by pure chance that one of these artists ends up with more patrons than the rest.This initial advantage makes the lucky artist the most popular, and since consumers prefer popular artists, other consumers will switch to her as well...
Very good point and it's like blogging as well - Michelle Malkin is a case in point who is popular because she's popular [the Liz Hurley syndrome].

[dearieme]

I see how this works for pop singers and such, but how does it work for talentless bastards like politicians - or am I confusing "talentless" with "having talents I despise"? Hang on, that applies to pop singers too. Ah, I may despise the talents of pop singers, but I can discern them. Is that the difference?

[chris]

Tom - I find em by subscribing to this:
http://nep.repec.org/

[nz conservative]

Being successful in areas like pop music is increasingly about the relationship between the star and the people backing them.

There are some very talented people that don't get on because they they can't form good relationships with their promoters.

This is certainly a lot of luck in whether a potential star can find a good promoter. Since artists are often very thin skinned, bad early experiences will often break their careers. They aren't like entrepreners who can keep bouncing back from failure.

[Chris Williams]

This is news? Chris D, you need to have a look at the history of art - and also at the academic practice of Art History (AKA outdoor relief for the upper classes).

[tom s.]

Chris - Thanks for the pointer.