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Millions of Americans soon will be filling out brackets and cheering their teams as the March Madness of the 2015 NCAA men’s basketball tournament sweeps the nation.

But hoops junkies know it’s about more than just X’s and O’s: Men’s basketball teams at NCAA schools generated total revenues of over $1.6 billion last year.

So, for the second year in a row, NerdWallet focused on what we call “Money Madness.” We analyzed the revenue that this year’s top-ranked basketball teams bring to their universities and quantified how valuable players would be if paychecks were allowed for college athletes.

Our study isn’t focused on advocating for or against paying student athletes — that’s a separate debate with many points to consider on both sides.

Key takeaways

Already at NBA value? The average value of a player at a top 25 ranked school is $487,617. That’s only $19,719 less than the minimum salary in the NBA.

Big bucks in Louisville. Louisville’s men’s basketball team generated over $40 million in total revenue last year. That amount is equivalent to the four-year cost for 535 students to attend the university.

The 2.6 million dollar man. Jahlil Okafor, one of the nation’s top freshmen, is worth over $2.6 million, according to our analysis. The average value of a player on his team at Duke is about $1.1 million.

Our analysis

We looked at the numbers to estimate the financial values of student athletes in this year’s top-ranked basketball programs. To do this, we adopted a revenue-sharing model similar to the one used by the NBA, where many of college basketball’s top players are headed.

Under this model, student athletes would be given 50% of all team revenues, which their schools generate through ticket sales, TV deals, merchandising and more. We also used this to estimate average player values at each of the men’s basketball teams ranked among the Associated Press Top 25 (as of March 2).

The following chart displays total team revenue, projected player revenue, number of players and average player value at the top 25 schools.



We also analyzed every team’s roster and each player’s performance to equate on-court production to monetary worth. In other words, we assigned players a dollar value based on how much they’ve contributed to their team’s success.

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The graphic shows the highest-valued player at each position — point guard, shooting guard, small forward, power forward and center — of the 340 players at the top 25 ranked schools.

To calculate these figures, we compared a player’s win shares — an estimate of how many team wins a player has contributed to — with total wins and assigned him an equal percentage of his team’s projected player revenue. Under this model, players are assigned dollar values based on their performance and their team’s success, too. In reality, many premier basketball schools generate high revenue even when their teams aren’t winning on the court.

Methodology

To find average player values, we applied the NBA’s revenue-sharing model, where players earn 50% of league revenues. Since data on this year’s NCAA team revenues aren’t available, we used revenue figures from last year.

Average player value = (2013-14 total team revenue * 50%)/number of players on roster

To estimate individual player values based on performance, we calculated the percentage of total team wins a player has contributed through win shares, then applied that same percentage to the team’s player revenues (50% of total team revenue). A player is valued at a fraction of his team’s revenues that’s equal to his proportion of win shares.

We also set a minimum salary for players whose win shares are below a certain threshold. In the NBA, the current minimum salary is about 0.804% of a team’s salary cap, so we applied that same percentage to each NCAA team’s player revenue to establish minimum salaries per team.

It’s important to note that there are several limitations to this method of assessing player value. First, statistics such as win shares aren’t the only measure of a player’s value. Second, most teams would earn significant revenue regardless of the names on the roster. For example, Duke’s basketball team would likely generate substantial revenue even if Okafor — likely to be a top pick in the 2015 NBA draft — wasn’t suiting up for the school.

Data on NCAA men’s basketball team revenue are from the U.S. Department of Education.

Data on team records and player statistics are from Sports-Reference.

Infographic by Enrico M Limcaco.

Image via iStock.