Date of Award

2016

Document Type

Thesis

Degree Name

Bachelor of Arts

Department

Economics

First Advisor

Qi Ge

Abstract

This study uses 2015 data from the PGA Tour and the European Tour to analyze differences in the returns to shot making skills between these two top professional golf tours. As the European Tour grows to become a competitive alternative to the PGA Tour, a player will be faced with a decision of which tour to compete to maximize the economic payoff. A model similar to Shmanske (1992) was used to run OLS regressions and quantile regressions. The quantile regressions were used to determine differences in the returns across various points on the earnings distribution. The findings suggest that a player on the PGA Tour requires a different skill set to be competitive than a player on the European Tour. The PGA Tour results are consistent with past studies on returns to skills in (e.g. Moy and Liaw 1998 and Alexander and Kern 2005). Driving distance and putting skills are significant determinants of earnings on the PGA Tour. Iron play and putting skills are significant determinants of earnings on the European Tour. This study adds to previous golf economics studies by investigating returns to skills on the European Tour and comparing those differences to the PGA Tour.

Creative Commons License

Creative Commons Attribution 4.0 International License
This work is licensed under a Creative Commons Attribution 4.0 International License.

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