The NFL, standing to the research done by Berri and Schmidt (2006), is the most balanced out of the most popular North American sport leagues. This outstanding result can be attributed to the composition of the league itself, a hard cap system and to the seven round draft. In addition to the draft round which favorites the teams that performed worse in the previous year, a compensatory draft has been established too, which allows those teams that “lost” in free agency to maintain a high level of competitiveness, by allowing them to acquire draft picks based on the value they lost in free agency. The draft round is accompanied by a hard cap system, where a salary threshold cannot be exceed for no reason whatsoever. This prevents the deep pocket…show more content… Going hand to hand with the salary cap, there is a high salary floor which guarantees a minimum contract to players, keeping all the teams very close to each other as far as payrolls are concerned, not allowing teams to have a minimum cost strategy. Finally, The NFL shares its revenues relatively to the size of each market, allowing more parity. Therefore, the NFL has very strict rules and invests a lot on the players who come out from college, not giving the chance to teams to have more than one or two big stars on their rosters as in the NBA. All these policies and the composition of the league itself made the NFL the most balanced league in the North American professional sports. Thus, as Berri and Schmidt pointed out, although it is not fully balanced, the system seem to work…show more content… Even if the owners are fighting in favor of one, the league hasn’t had the chance to apply a salary cap system due to the strong player association which doesn’t allow for one, and since the league is very successful monetarily and fans keep attending the games even if lately there have been a few teams that prevailed over the others, there isn’t an imminent need to impose one. Although, the MLB has a system based on the Luxury Tax, which prevents the big-market teams to outspend the small-market teams. The tax threshold nowadays is set at $189 million, and it dictates that the teams which went over the tax for the first time to pay 17.5% of the amount they exceeded, 30% if they are a two year repeater, 40% if they went of the threshold three years in a row and finally 50% for the following year they have been a repeater tax payer. The revenue generated from the tax though, is not distributed to the other teams in the league as in the NBA, but it is used for other purposes, such as the player benefits and on investment in areas of the globe where baseball is not developed. Due to the league structure and to the tax system, the MLB has always been quite, but not perfectly, balanced. In the last couple years big-market teams started to prevail over the others, therefore the league, following the 2012 Collective Bargaining Agreement, introduced a Competitive Balance