Malcolm Gladwell argues professional sports don’t operate like a normal business, citing former Red Sox owner Tom Yawkey as an example. Even though it would have boosted attendance in the 1940s and 1950s, the Red Sox integrated the team very late in the game:
Yawkey was not just a racist, in other words. He was a racist who put his hatred of black people ahead of his desire to make money. Economists have a special term they use to describe this kind of attitude. They would say that Yawkey owned the Red Sox not to maximize his financial benefits, but, rather, his psychic benefits. Psychic benefits describe the pleasure that someone gets from owning something — over and above economic returns — and clearly some part of the pleasure Yawkey got from the Red Sox came from not having to look at black people when he walked through the Fenway Park dugout. In discussions of pro sports, the role of psychic benefits doesn’t get a lot of attention. But it should, because it is the key to understanding all kinds of behavior by sports owners — most recently the peculiar position taken by management in the NBA labor dispute.
This is one of the main reasons why I don’t buy the Libertarian argument that the Civil Rights Act was unnecessary, or that Black people in the post-Reconstruction South remained oppressed due to the enshrinement of discrimination in the law via Jim Crow. Libertarians argue that if discrimination hadn’t need given State sanction, private forces would’ve naturally given Blacks alternatives to meet their needs, because it would’ve been profitable to to do so.
But what Libertarian advocates are forgetting is this: the reason Jim Crow was so easy to facilitate in the post-Reconstruction South is because private actors and organizations threatened people who voted for the wrong candidate. Private coercion and threats created a government capable and willing to pass Jim Crow laws with ease, because abolitionist whites and newly-freed slaves were either underrepresented, or simply not represented at all, on account of being scared away from the polls.
The argument also assumes that there was a body of White business owners in the South large enough to give Southern Blacks, in aggregate, meaningful alternatives to the racist shops that refused to serve them. Assumedly it would’ve been profitable for some people to tap into the “Black” market to get the customers that racist business owners were turning away. But this again, misses the forest for the trees: what do you think happened to White people that helped Blacks in the post-Reconstruction South? Do you think they were merely rapped on the knuckles?
There are human desires and motives stronger than the profit motive. Traditional economic models based on rational self interest do not work when a person would rather see his shop close than serve someone of a different skin color.