Thursday, December 24, 2009

FBJ Cross Post

My newest article is up over at Fantasy Ball Junkie. It's a simplified version of my previous explanation of a fantasy baseball model (H2H) based on MRP of each team, rather than large discrepancies in tournament-type payouts (though, that part of it can still be kept in tact).

UPDATE: Apparently someone has hacked the Fantasy Ball Junkie Site. I'm really not sure how worthless your day needs to be to feel that hacking a fantasy baseball blog is worth your time. But, alas, if you click on the link above it won't take you to anything right now. Our editor is out of town, so it might be about New Years when it's fixed up. I'll post here when everything is working right.

UPDATED UPDATE: Looks like FBJ is back on track. Should be some good posts coming in the New Year.

Friday, December 18, 2009

An Interesting Link

This link to discusses the new websites that provide professor notes for specific classes to students free of charge. The article is very interesting, and it talks specifically about Harvard and MIT (as well as their economics professors). Below is probably one of the most interesting quotes in the article, and definitely is one I'm sympathetic to. Academic journal articles are expensive (as Colin Wyers notes in one of my previous articles), and it does go against the underlying idea of academia. Of course, there needs to be funds for the journals to operate, and perhaps some profits, but it makes it hard for communication between academics and non-academics in a world of mass communication for everyone:

Still, part of the reason that there haven’t been more lawsuits around the intellectual property of lectures is that professors and universities see their mission as fundamentally different from that of a music label or movie studio.

“Harvard and MIT and Stanford and Princeton, we’re not Decca records. Our job in life is to provide enlightenment to the world,” says Lewis, an outspoken critic of the way content providers have used copyright law online. “We have to make a living doing it and all the professors have to be paid for their labors, but the notion that universities would inherit the oppressive picture of the way intellectual property is treated by the music industry is really a fundamentally warped view of what the ultimate purpose of universities are.”

One of the big issues I see with releasing notes is allowing students to skip classes. While they pay their tuition, and should probably have the right to do what they want, there is definitely value in attending classes and discussion. By just reading notes, this value is not realized in many cases. University of Phoenix has essentially taken advantage of the note/book reading aspect of the internet. I think this is the way education is going in general, but I'm not sure there is a perfect substitute for social interaction and verbal discussion. I think having such mass information from around the country can supplement this discussion to an enormous extent, though..

Hat Tip: Greg Mankiw's Blog

Update: Over at ECONJEFF (my microeconometrics professor's blog, and former student of Nobel winner James Heckman) Jeff Smith offers some insight into differences among students at different institutions. This link is related to this post a little bit, as well as my previous post on Division III athletes in a roundabout way.

Division III Academic Performance a Problem?

It's been a while since my last post, as I've been coming down to some final exams/projects and starting some really exciting analysis on some attendance and competitive balance stuff here at work. With the holidays coming up, I wanted to be sure to get at least one more post out (maybe two) with a little more substance than "check out Fantasy Ball Junkie". I hope to have a post about differences between academic and internet publishing and how both can be valuable in the near future (as I had told many people). I'm giving my best possible diplomatic attempt at that discussion, which is why I'm taking a while to post.

Recently, Phil Miller discussed Division III athletics and academics over at The Sports Economist. The article they link is here. This is a topic that hits close to home with me, since I played baseball at a small Division III college. There is a very interesting discussion over there that includes comments from Dennis Coates and AG Dube (who is apparently a graduate student at Houston). As a former student athlete who holds the 'student' portion close to heart, there are some inferences made that I take some exception to. That is more of a personal matter, and there are a number of different ways to look at this problem. Today I feel like rambling on, so don't expect an extraordinarily organized post below.

As an undergraduate, I often heard the social stigma or stereotype about athletes not being great students. This is probably very true at the Division I and II levels. The article mentioned tries to make a case for the same problems at the Division III level. While I'm sure it's true to an extent, I'm not convinced it's actually a problem anyone needs to be severely worried about.

As my honor's thesis, I looked at academic performance of athletes and non-athletes at my small school and didn't find much difference in performance. That was without controlling for much (as an undergrad, I didn't have the ability or resources at a small school to do anything too sophisticated). One of the interesting aspects I did find, though, was that student athletes self-reported better time management skills to an extremely significant extent. In much of the literature I read (which includes the Terenzini that AG Dube mentions in his TSE comments) it seems that better students tend to be attracted to athletics in high school. So, I think there's some other things to consider when talking about a college experience.

Beginning with Division I, we know that numerous exceptions are made for students with elite athletic skill. The reason we probably shouldn't worry too much about this is that they don't make up a significant portion of the student population at many large Division I schools. Secondly, they bring in significant revenue for the school and attract students to apply there (see the "Flutie Factor"). Given the smaller number of 'exceptions' made, proportionally to the Division I school student population, I don't think there should be huge worry about destroying the school's academic reputation. Obviously there's a point at which there can be problems (getting in trouble with the law, independent study scandals, etc.). Jim Harbaugh recently took a swipe at Michigan about the exceptions they make for student athletes happens.

As for Division II, I don't know much about these schools. From my observations, they're much lower on the academic totem pole than their Division III and Division I counterparts. That's okay, too, as having institutions for students who can't get into Stanford is still a very good thing for society, in my opinion. All I do know about these schools is that they are allowed to give out scholarships. I can't imagine the revenue they see from their sports is really significantly higher than Division III, but I'm sure it's a bit more of an issue in their athletic departments. I don't really know.

The Division III athletics mantra is that academics come first. I think most of the concern is over only 2 sports: Football and Basketball. I actually think this is the concern for Division I and II as well. As someone who played on the baseball team, I can say we had a lot of very smart guys. Yes, there were a few bad eggs, but they're also around in the general student population. I know it's a bit anecdotal, but my team consisted of the following career paths from only a few of the 7 classes I played with:

Medical Student at IUPUI (PhD/MD finalist)
Columbia Law (175 LSAT is the rumor on him)
Full Scholarship to Richmond Law
Job Appointment at NSA
PhD/MA Student at Michigan
WBC Coordinator and MLB Tomorrow Fund Grant Administrator
Minor League Umpire (currently Double A)
Multiple T. Rowe Price employees
Manager of Autopsy Lab
Booz Allen Hamilton Consultant

Many of the guys on my team had significantly higher GPA's than I did. Most of them had no trouble getting jobs right out of college and most work with the government and are currently working on their MBAs. None of them are in PhD programs. Which begs the question: does marginal improvement in GPA really matter?

I'm willing to bet that on every application, my friends put that they played baseball in college. From my experience, interviewers definitely take this into account. Every interviewer has some paradigm about how they think playing athletics affects academic performance, and I'm sure they apply that to their evaluations. Isn't the idea of going to college to have the social experience and have better job prospects? Does anyone go to college to get the highest GPA so they can brag about that forever? I doubt it. And to gauge the value of your college education by GPA alone is ridiculous. Besides maximizing utility during college (as Dennis Coates suggests, and I agree with), what else could college athletics be doing for its athletes? Below is a non-exhaustive list of reasons I've heard people say they play college athletics. Some are hilariously silly (but true), while others make a lot of sense.

1. Social Networking--I know from experience that I never have, and never will, have a group of friends closer than those I made in college through playing baseball. I had friends not on the team, but with the exception of one, I never see them. The comraderie is invaluable and can actually lead to future jobs.

2. Athletes (especially at DIII) are generally from higher-earning families--I don't know how true this is, but from my experience this is the case. It relates back to social networking and the 'who you know not what you know' mantra about finding a career.

3. From the Male POV, athletes seem to attract "better" and "prettier" women--YES, it's silly! I know. But let's think about it for a second. This may not be a valuable asset to a lot of people, but it definitely is to some (whether or not they admit it). I doubt Tiger Woods would have married a Swedish supermodel if he wasn't Tiger Woods (and if he did, probably wouldn't have cheated on her as much). Similarly, though to a lesser extent, it's natural for women to be attracted to men who appear athletic. That's good for reproduction and is an evolutionary consideration. What about being able to attract girls from higher-earning families? While not politically correct, I think it would be a valuable addition to examining the outcomes of playing college athletics. If guys that play sports are often from this population, I think it's likely that the girls who watch them are of a similar breed.

4. Playing athletics could help with time management skills--This is in fact what I seemed to find in my undergrad thesis (though, it was self-reported and my undergrad work should be taken with a grain/chunk of salt). In addition, those that took the survey in-season reported even higher time management skill perceptions. I can't remember the theory exactly--it has to do with temporal myopia...something like undergrad advisor was working on this stuff--but researchers have found that when you have much more to do, you're much more efficient in getting it done. When procrastination isn't an option, it doesn't happen. This is the case with sports, as I often got my assignments done well in advance of the deadline. With game rescheduling uncertainties, it was silly to wait to the last second to do an assignment.

5. People like athletes--Well, some people. Some athletes are assholes. However, I think that you would often find an interviewer at a job very impressed with the fact that you played a sport in college. So impressed, in fact, that it may overshadow the fact that your 3.4 GPA wasn't as good as the other guy's/gal's 3.65 GPA. I'm not sure people have measured the extent of this effect. I've met plenty of people that think it's really cool that I played baseball in college. Others couldn't care less. Considering we weren't very good, I side closer with the latter, but I'm proud of having been a student-athlete.

6. Developing social skills--Some college students that focus too much on their academics (I'm using 'too much' loosely) don't actually gain the social skills needed when working on a job or going to an interview. While athletics aren't the cause of increased social skill, they definitely provide a platform for improving interaction with others.

7. For students at the margin of staying in college, participation in athletics seems ambiguous to me. Some may find it too daunting to do both athletics and academics and may drop out of athletics to focus on school (in fact, I found this to be true for those not ready to take on that challenge in my udergraduate thesis). Other students who may have otherwise dropped out of college may be staying there in order to continue playing sports. Whether or not that is good for that student is also ambiguous.

8. Athletics can complement academic discipline. This is similar to other extracirriculars. Athletics are just another club to be a part of. Many schools tout the importance of extracirriculars, and athletics is no different. In addition, athletics can serve as a 'break' from the rigor of college academics.

9. Academics can work as an outlet for students. This is similar to #8. Students involved in athletics are probably less likely to get involved in other activities that may be detrimental to their schooling or lives in general. I think this is more important at the high school level, but I don't see why it shouldn't be applied to college as well. If I wasn't playing baseball, I would likely have been filling up my time with other activities. I'm sure one of those would have been a lot more partying and other stupid, useless crap. To assume that non-athletes spend all of those hours studying rather than playing sports is just wrong. (Also, to assume I didn't "have fun" in college is also wrong.........)

10. Athletics provide a place for improvement of health and physical fitness--As pointed out at TSE, colleges tout the idea that they improve mind and body. Intelligence researchers have often pointed to multiple facets of intelligence, one of which being kinesthetic movement. With the obesity problems we have in this country today, I don't think chastising athletics as an insititution is good practice for those truly interested in improving life for its students.

So what could be going wrong? While I haven't read much of the literature, I imagine there could be the following problems:

1. Not controlling for 'innate' ability (some do and some don't)
2. The fact that athletes could be less likely to drop out thanks to athletics
3. The idea that better students tend to flock toward athletics and can therefore afford a marginal drop in GPA.
4. My personal experience shows outliers being a culprit in lower athlete GPAs. I think there is definitely an 'at risk' population of athletes.
5. Football and basketball could be exceptions to a rule otherwise followed in Division III athletics. I think AG Dube mentions this in his comment section, saying sports other than these often score much higher in academic performance scales.

So what's the problem with Football and Basketball? These two sports are ones that seem to pull more from inner city, minority, or lower-income populations than the others. I argue that this is GOOD! Those students may not otherwise have the access to a college education. Since only 2 teams are not a significant portion of the population at most schools, I don't foresee this being a risk to academic integrity even at a Division III school--if it's a perceived problem, I think they are willing to change things quickly. In fact, our basketball coach had brought in certain players that had been kicked off teams at Division I schools. That coach was swiftly fired after an incident with one of those players.

The revenue from D-III athletics is close to nothing, so what's the point in hanging onto a coach if he's hurting your reputation? I think the externalities (of a Flutie Factor-type) are pretty insignificant at the Division III level as well. If non-athlete students cared about sports that much, they probably would have gone to a large school.

There are pressures from coaches because they're incented to win...just like Division I coaches. They're paid for that. However, I don't think this is a serious problem at most institutions. The ones mentioned in the article, including Chicago, don't seem likely to allow significant pressure against academic rigor. I can say that our coach did not like players to be science majors: too many labs conflicting with classes. Baseball was the reason I didn't major in Biochemistry. But it wasn't the coach's pressure, it was my own desire to continue playing athletics. I saw the value of athletics being much higher than Monday afternoon lab, so I went with baseball. I'm glad I did, because I'm not sure I would have stayed in college had I chosen not to play sports. I have baseball to thank for making my college education a happy time. NCAA and its member institutions would be well-served looking at well-being, as well as academic performance, if it wants to know its true effect on students.

Update: I wanted to link AG Dube's blog here. It's a very well-written site and very informed on many issues. I'd recommend it, though I disagree with some of the content implications. But that's the fun of discussion! Definitely worth checking out. His most recent post on required Bowl ticket sales is very interesting, and something I did not know about. Without knowing more details, I can't take too strong of an opinion on the issue, but it sounds like Western Michigan go screwed.

Friday, December 11, 2009

Fantasy Ball Junkie Cross-Post

Over at Fantasy Ball Junkie, I'm re-explaining my idea for a Marginal Revenue Fantasy League Model in comparison to the current standard of a Tournament Model. It's mostly shortened (with some corrections from my originals) versions of my previous posts here, here, and here. FBJ has really picked up the number of posts each week, and we're moving up on Ball Hype for Baseball Blogs pretty quickly. If you're interested in a little different take on fantasy baseball, I'd definitely suggest checking the site out.

Wednesday, December 9, 2009

Great Moments in Out-of-the-Box Thinking

I wasn't going to put up a post today (I have a final exam tomorrow), but I couldn't help but link up this post by Chris Moore at Baseball Analysts. This is the type of stuff that gets my attention, and Chris does a great job of explaining how having priors can actually improve umpire performance. Umpires will probably hate this idea, because they think they're completely objective and this goes against their squeeky clean self-portrait in a way. As someone who pitched much of his life, I'm not sure what I think of this. Talking to umpires, I have heard them say they're more likely to call a strike for a pitcher who's throwing them. I'm not sure if it's for the same reasons as Chris mentions. But it's a fantastic cross of sabermetrics, real baseball issues, statistical analysis, and psychology. Kudos to Chris.

Tuesday, December 8, 2009

Possible Granderson Trade

ESPN is reporting that the Yankees, Diamondbacks, and Tigers are close to a deal. This definitely makes sense for the Yankees and Tigers, but I don't understand why the Diamondbacks are interested. In the deal the Diamondbacks send away Max Scherzer and a pitching prospect (their 2008 1st Round Draft Pick) for Edwin Jackson and Ian Kennedy. Kennedy seems to be past his 'prospect' status, and Jackson was a huge breakout last year who slowed considerably toward the end of the season.

With Brandon Webb coming back and Dan Haren in the rotation, is starting pitching really a concern for the Diamondbacks? Scherzer, in my opinion, has one of the best arms in the game for a young prospect, and is under control for a while. He's only one year younger than Jackson, but has a much better strikeout rate. Both gave up a lot of home runs last year. Not that I've done any sort of in depth analysis, but I don't really understand this move on Arizona's part. Yes, Davis and Garland are gone, but they have a 3 man front that most teams can only dream about, with the third under significant cost control. Haren-Webb-Scherzer sounds pretty good to me. At least good enough that paying Edwin Jackson a bunch of money for a marginally better performance than Scherzer doesn't seem right. Kennedy can't be a serious contender for a rotation spot at this point.

My Hometown on The Sports Economist

It looks like Dennis Coates has featured my hometown of Frederick, Maryland on The Sports Economist today. Apparently, the city thinks Bryan and Kevin Voltagglio's fame on Top Chef will be bringing in lots of extra revenue for the area. Doubtful, considering I lived there for 23 years and have no clue where the restaurant is--and there's not much else there. The Frederick area was a great town to grow up in, but in terms of tourism, there's not much to see. Maybe Civil War buffs will want to visit Monocacy battlefield? The Frederick Keys for minor league fans (and the nearby Hagerstown Suns)?

But it's fun to have your hometown in the spotlight. I grew up watching the Frederick Keys, and had the opportunity to see Nolan Reimold and Matt Weiters playing together there. The stadium used to be beautiful, but it's becoming run down. It's still a fun place to watch a game, but it's kind of appalling how bad the field conditions usually are for the players. I knew the head of the field crew really well, but I'm not sure he's still there. I've often felt like calling him up and asking what the hell their problem is. Hey, at least they have a carousel.

ADDENDUM: It looks like the Keys are renovating the field and the stadium beginning last year. I'm not sure who's funding this (if you can find information on that, let me know). The owner was named the Minor League Executive of the Year by Baseball America. He owns a bunch of teams, apparently, and bought the Keys in 2006.

More Links

Sorry there has been a whole lot of nothing lately. I got slammed at work/school and am still trying to recover. I have a few posts about ready for Fantasy Ball Junkie, so the next few posts here might be linking up over there. For now, I'll provide some links:

1. Tim Donaghy claims that basketball is by far the sport most vulnerable to manipulation. I don't have an opinion here, but I'm curious what others think. Any sport has some extent of subjectivity about them (we're not counting 'judged' olympic sports...those are a crock IMHO). I don't know enough about basketball to make a judgement here, but I imagine baseball could run into this problem as well, especially considering what JC Bradbury found about MLB umpires essentially being tenured employees, with little reprocussions for bad work.

2. We saw Cincinnati jump TCU in the BCS poll this week. I'm curious if this would have been the case if Nebraska hadn't completely blown the Big XII Championship game. Would there have been more high votes for TCU to get them into the BCS Championship Game in the Harris poll? I suspect that there are a number of non-NCAA cartel people that would have liked to see a mid-major in the Big Game. Too bad. It would have been interesting to watch Alabama play another non-BCS team in a BCS bowl game. It didn't work out so well for them last year. It should be a really good game, though, given the type of teams playing one another.

3. We have a defensive player from Nebraska in the Heisman finalist picture. This should be an interesting day. My vote is for Gerhart, but if I'd seen Suh play more I may have voted for him. Ingram has been huge for Alabama, but Gerhart has 11 more touchdowns and more yardage, not to mention helping Stanford destroy USC this season.

Monday, November 30, 2009

Arbitrage Failure: When the Sleeper Bubble Bursts

I have a new article up over at Fantasy Ball Junkie taking a look at risk, sleepers, and how we see similar re-evaluation of risk in arbitrage markets (for example, in merger arbitrage). The conclusion is the same basic conclusion most people come to when discussing sleepers: BE CAREFUL WHEN YOU REACH!

In general, it's a very basic extrapolation of a really neat presentation I attended by Columbia Business School Professor Daniel Beunza. Beunza investigates topics in the quantitative side of economic sociology and its interaction with technology. The basis for my extension to fantasy can be found at his site here. Given Dr. Beunza is way smarter than I am, I'm sure the article somewhat minces much of the intellectual content he provides in his work. However, the main issue is in tact when evaluating risk with fantasy baseball sleeper picks.

Below is a very simple picture of how risk assessment is changed using a collective "implied risk". The distributions don't have to be normal (and likely aren't when someone uses their biased judgement on a sleeper). The important thing to see is that much of the area under Curve 1 is ignored (to the left of Curve 3) when a sleeper is touted excessively.

All in all, I enjoy finding real-world corollaries to fantasy sports. Some of them can be a stretch, but often times they can be informative and support ideas presented about the structure and processes involved in the game.

Wednesday, November 25, 2009

Trying to Keep Up

It's been one of those weeks and the Holidays sure aren't helping get things done. I have much of a new post written up here...hopefully a bit less brash than the one that seemed to get a bunch of attention. Also, we should have a new Fantasy Ball Junkie post up soon. Here's a couple links:

Pizza Cutter describes how thinking about baseball and sabermetrics influenced how he thought about his academic work in Psychology. A fun story. My feeling is that using interesting topics, especially sports ones, would help the nitty gritty of statistical become less daunting for even the undergraduate level class. In fact, I remember a recent NSF Grant awarded to some professors studying just that.

Phil Birnbaum has more on aging over at Sabermetric Research Blog. I'm curious to hear the next post, as the aging question is an interesting one to me. Each of the methods I've seen used have bias problems--which are unavoidable for the most part--and I think it's still a fairly fruitful line of sports research (especially when thinking about heterogeneous aging across "types" of players).

The Sports Economist has an interesting link about negative intangible externalities from sports. It's an interesting take on the issue, though Rod Fort feels the article is a bit one-sided (comments section). I guess we should all remember that people are "reading and quoting".

That's all for now. Apparently I'm supposed to hang out with my family.

Tuesday, November 17, 2009

"Fantasy" Announcement

I mentioned the other day that I had a forthcoming announcement to make here. Well here it goes.

I'm now writing a column at The Fantasy Ball Junkie that incorporates simple economic thinking into fantasy sports, league rules and outcomes, along with other things that can cause problems when leagues are designed and run. The first post of "Weird Science" is up here. I essentially argue that the common auction format used in fantasy sports rewards craftiness, rather than preparation and evaluation. While I think both are fun, the basis for fantasy was originally to reward the top evaluator and roster builder. My main interest lies in the fact that FAAB auctions are run differently. There are a lot of interesting corrollaries in real-life auctions that I could go into, but may save that for another time. The article lays out the basic argument, and proposes something new for people to think about when designing their league.

We hope to have the column over there be semi-regular (weekly commitments are tough for me given my other obligations--a.k.a. slave duties to Michigan faculty). I think it will be fun. I'll be sure to link there at this site whenever a new column is up. I'd also suggest checking out the other content there. It's a great resource to have when it comes to strategy and there are some really smart people running the site.

ADDENDUM: Be sure to read the comments section, as there are two very important corrections to the article. The presentation of the ideas was unclear, and I made a mistake by not going through the editing process as carefully as I should have. They're easy fixes though, and are up in the comments section.

Monday, November 16, 2009

Balance in the NFL Going to Sh*t?

Over the past few weeks (and especially after the beatdown that New England laid upon the Titans) I've been hearing commentators, colleagues, and friends claim the NFL just isn't very interesting this year. The claim is that the competitive balance of the league, or the evenness between the teams, has taken a huge downturn and there must be something wrong with the league's construction. My first thought is that the NFL has long been generally thought of as the most balanced league of North America's Big 4 and any change it would see would most likely be downward (when you're at a peak, the only way to go is down). My second thought was that, yes, there do seem to be a large number of blowouts this season. But looking at the standings, I just don't see that clearly. There are only 4 teams with more than 6 wins thus far in the season, and yesterday the awful Redskins beat the not-so-long-ago-unbeaten Denver Broncos.

Now that we're at a point where everyone has played 9 games (except for the Browns and Ravens tonight, but for the sake of saying this year is unbalanced, I'm assuming the Ravens win) I decided I'd check to see if there has been a significant change in balance this season. I'll just use a simple Ratio of Standard Deviations (RSD--a measure popularized by Roger Noll and Gerald Scully). This measure is a ratio of the standard deviation of winning percentages (SD) divided by the "idealized" standard deviation in a perfectly balanced league (ISD). A perfectly balanced league is defined (as all teams having a record of 0.500)--this is a stupid mistake on my part as noted in the addendum below...especially since I work with this data a lot. The reason for the denominator is to control for the number of teams and number of games played in each season to make it comparable across sports or seasons in which these variables change. The lower the RSD, the better the balance. From 2001 to 2008, the RSD was as follows:

2001: 1.628
2002: 1.321
2003: 1.535
2004: 1.540
2005: 1.694
2006: 1.447
2007: 1.661
2008: 1.658

And at the 9-game point in the 2009 season, we see: 1.448

So, at this point in the season, it looks as though we're on the better end of the balance spectrum (if you believe that more balanced means a better league--which, of course, is always up for debate). Keep in mind that RSD is not the only way to measure balance. However, it works as an interesting quick check on the distribution of wins around the league. It very well could be that there is a huge gap in talent between the top and bottom teams, where the best teams pummel the worst. We've seen some of this, but we've also seen the Redskins beat the Broncos and the Raiders beat the Eagles.

To be honest, I enjoy a demolition every now and then. Watching the spectacle of Tom Brady throwing 6 TD passes in one quarter is a lot of fun for me. It would probably get boring if there weren't teams that could challenge the Pats, Colts and Saints, but I don't think there's any lack of competition in the NFL as the Saints last few games have shown. I'm not ready to conclude that the NFL system is now completely broken, so let's not rush to fix it.

ADDENDUM: Guy points out a problem with my explanation. The ideal league isn't one with all .500 teams, but one where each team has a 50% chance of beating any other team. He makes some points about the difficulty at the extremes for balance, which are good to keep in mind. The correction for the model in terms of season length can overcorrect for short seasons like 9 games, making the RSD look more balanced than the league actually is. Given this, I still don't think balance is a hugely significant problem in the NFL this season as some commentators have tried to point out.

Thanks to for the data on past NFL season RSD. You can find the data for this post, as well as numerous other sports business data files by clicking the link on the sidebar.

Friday, November 13, 2009

Another Link and an Interview

Today, I'm at home sick so I have a little time to sit here at the computer. I briefly mentioned a problem I have with the general "Sabermetric Community" when I posted about the argument on replacement players at The Book Blog (that actually stemmed from an unfounded accusation that a bunch of "stupid economists" wrote a flawed paper on Factor Analysis--not really an Econometric technique). However, I think JC Bradbury does a much better job than I in his interview at Chop n' Change.

Bradbury sums up my thoughts on interactions with this group of people pretty well. The general pattern on many sites is to simply ignore or misrepresent any sort of perceived conflicting view (even if that view isn't actually conflicting with anything). Now, I am not here to state that these people aren't intelligent, or that it doesn't happen to some extent on both sides of the issue. To the contrary, many of them are very smart people, but with an unfortunate arrogance that I don't understand. In my discussions with top sports economists, any inconvenient truth presented seems to simply be ignored or, as Bradbury puts it, "chastised without heeding the point."

An example is that of my previous post on discrimination in the NHL. While Phil Birnbaum claims that the book is making "premature accusations", the phenomenon of this discrimination has been documented and studied for more than 20 years in the sports economics literature (if that interests you, see the citations in my previous post). Despite mentioning these papers--supplemented by a sarcastic yet friendly post by sports economist Rodney Fort about making sure to be well read on a subject before heavily criticizing it--went unheard for the rest of the thread. The conversation continued as if this was truly a new problem.

This isn't an isolated incident. I recently read an article over at the Harvard Sports Analysis Collective that essentially looked at a time series of competitive balance. While I think this website is a great learning tool for Harvard students, it amazes me that their resident Harvard statistician allowed this article to be posted. There are a couple of reasons for this. The first is simply that taking the standard deviation of wins is problematic when comparing across years. The number of teams and games has changed dramatically over this time, making it very difficult to compare across seasons. In addition, the competitive balance change has been well-documented by Rodney Fort and Young Hoon Lee in a series of papers from 2005 to now (and probably will continue). That DOES NOT mean that further analysis is inappropriate. To the contrary, more inspection is needed. However, presenting work with no reference or understanding of the problems is troublesome. Finally, allowing these students to take others' work on the internet as a given isn't something we would want going on at an institution like Harvard. In fact, the last thing we want is for Harvard graduates and students to participate in what Bradbury calls a "groupthink attitude".

Finally, Bradbury mentions an article at The Book Blog that completely abuses a model developed by John Hakes and Skip Sauer. I had in fact read the article by Tango and was appalled at the misuse of the model myself. I began writing a response explaining the difficulty with extrapolating a regression outside of a sample, but decided it would simply fall upon deaf ears. At this point, I just don't bother. It seems that others that do not look upon Tango as some sort of cult leader have given up as well.

I am extremely excited about a forthcoming special issue of The Journal of Sports Economics that discusses many of these problems in depth by some of the most vocal, and most knowledgable, economists in the field of sport. Hopefully self-proclaimed "subject matter experts" will take some of the implications in the issue to heart. However, my expectation is that none of them will bother to read it.

The current state of The Book Blog reminds me of sitting in MBA economics classes at the Business School here at Michigan. Without understanding of how models are simplistic in order to explain expectations of markets, arrogant students consistently chastise the professor because of a single example they ran into at work. The professor's response is always, "Well, of course there are anomolies, but on average X happens" as if he was waiting for it. This statement just doesn't get through to people for some reason, despite its generality. The thing that blows my mind about this entire problem is that Sabermetricians believe they are critical thinkers. They are people who ran into others ignoring their opinions for years or criticizing their silly 'statistics' based on small sample sizes for years. Yet, the arrogance continues to blind minds to the fact that economics and Sabermetric study are so interrelated that ignoring the basic economic principles can be counterproductive in progressing the science.

While I continue to post things on this blog, I want to reiterate that what I post here IS NOT something that should be taken as science. Most of what I write is a general brain dump, or interesting tidbits and extensions using projects from my statistics classes. I hope to have a monthly disclaimer to ensure this is understood, and that fostering discussion and well-read arguments is part of my intention. My ideas on this site are not to start an online pissing match, or to out-do anyone else. Please see my Introduction as to how I think about the things I write. I try to write with the utmost care, but can make mistakes. I hope they are pointed out in a manner conducive to discussion.

So let's all take one from Rodney Fort's book, as he says, "Let's all READ MORE ."

ADDENDUM: Here's the Rosenthal article...where he supports the idea of sabermetrics and claims their findings have greatly enhanced our understanding...yet gets heavily criticized elsewhere on the internet.

Wednesday, November 11, 2009

Forthcoming News and a Fun Link

I have some interesting news in the works for my site that may redirect its focus (and it's 2 readers) somewhere else. It's been busy lately and keeping a site up myself has become difficult (at least with any meaningful material). I'll leave that for later, though.

Over at The Sports Economist, Brad Humphreys has an amusing article about the early season NCAA Basketball "tournament". Click here to go over there.

Friday, November 6, 2009

Better Models than RPI

The other day, when clicking through the Center for Statistical Consulting here at U of M, I came across one member of the group (a current PhD student here) who had a link to his site where he lists a large amount of research he's been involved in. His name is Brady West, and the reason I'm posting the link here is that he has a couple publications in Journal of Quantitative Analysis in Sport.

One study develops a model that, apparently, far outperforms that of the RPI system currenlty used in choosing the 64 (65) teams in the March Madness tournament for NCAA Basketball. West advocates that those in charge should use his model to pick the teams. After just a quick look over his data (and also knowing some of the problems with RPI), I would have to agree with him. Of course, that's leaving aside any anti-trusty type things that constantly go on with NCAA, the BCS, and probably March Madness.

His other study looks at predicting teams winning college bowl games. I think he's still working on that one, but the preliminary analysis published in JQAS is interesting. West seems to know his stuff (he's an alum of the graduate program in Statistics here as well) and it's nice to know there are statisticians at U of M that may be willing to work with sports and maybe at some point with the Sport Management Department.

Anyway, you can find his website here, which also includes his data and Excel files.

Tuesday, November 3, 2009

Quick Post on Curious Poll Results

I was jetting around the internet this morning checking up on the latest sports news and came across a poll at CBS Sports that asks the following question:

How will the World Series End?

A. Yankees in 6 (46%)

B. Yankees in 7 (11%)

C. Phillies in 7 (44%)

The thing that really interested me here was the breakdowns of voting. It was really intriguing to me that so few people thought the Yankees would win in 7 (I personally voted for Yankees in 6 with no allegience to either team).

At first glance, we might think, "Why do so many people think that if the Phillies win tomorrow night, they have a 4x larger chance of winning the whole thing than the Yankees?" But let's break this down a little differently and rephrase:

Who will win the World Series?

A. Yankees (57%)

B. Phillies (44%)

I know those don't add up to 100%, but it's just a rounding error. Anyway, it looks like the majority thinks the Yankees will win the World Series. That's expected, given where it's at right now. The problem with our first glance is this: we're not conditioning the Yankees win on having to play a Game 7, while the Phillies MUST play Game 7 to win.

What the original poll is telling us is not that people think the Phillies have 4x the odds of winning that the Yankees do, given there's a Game 7. If we re-run the poll after tomorrow night's game, assuming the Phillies won, we'd probably see something more like the second poll. Those that think the Yankees will win in 6 games will just vote for the Yankees in Game 7 (mostly). Why is this interesting?

Well, it relates back to the way that the Olympic voting took place and how the votes that are split between two choices become skewed when there is multi-part voting. Apparently, many voters had Chicago and Rio as their top 2 choices, but that actually was bad for Chicago. JC Bradbury has an interesting post on it here.

Anyway, nothing groundbreaking in my post. It's a pretty well-understood phenomenon. I hadn't posted anything for a while, and needed a brain dump. I just thought it was interesting, given my first impressions of the poll.

On another note, I'm fiddling with positional adjustments for the HOF Batters to see if I can improve my prediction model from before. I'm also working on an article discussing the optimal auction structure for fantasy baseball leauges. Those should be up here shortly.

Wednesday, October 28, 2009

Umpire Advancement and Opportunity Cost

I'm still in link mode. Been super busy then got sick on top of it. I've been fiddling with the pitcher data for the Hall of Fame, similar to the hitters from before, but have run into some problems with inconsistency in the predictions. It may not be feasible, given the significant structural change in how pitchers are used over time. Anyway, here's a link over to Sabernomics, where JC Bradbury has a really neat new study about umpires, their pay structure, and how to ensure MLB has the best ones at any given time. It's a lot to think about, and really interesting.

Thursday, October 22, 2009

Pitch Classification Algorithms...NEAT!

Busy day, so I'll send you over to The Baseball Analysts, where Moore describes his algorithm for pitch classification. A really cool technique to get this Pitch F/X data to give us answers about pitchers. This kind of thing is really interesting!

Wednesday, October 21, 2009

Not-So-Great Moments in Not-So-Objective Research

As I'm sure you've noticed, I've been pretty busy lately. Today, I'm going to link you over to The Sports Economist, where Phil Miller links a new paper claiming there is discrimination against women in college sports.

First, I want to say that I think women should have every chance that men have to play sports. If there's a female that can hit home runs consistently off of Tim Lincecum, I want to see her in MLB. If there's a girl that can dunk on LeBron, I want to see her on the Lakers. But discrimination is a tricky thing, and the researchers in this paper seem to completely miss the ball to the point of absurdity.

We can divide discrimination into a few categories from a labor market perspective: consumer discrimination (which I mentioned in my previous post on hockey), co-worker prejudice (similar to consumer but with coworkers not wanting to work with certain groups), employer prejudice (the employer just plain not liking women), and statistical discrimination (sort of like how car insurance companies charge higher premiums--this is NOT prejudice, but gets very convoluted and is often misinterpreted).

So let's check out each one of these.

Statistical Discrimination: This one probably brings us to market forces and the laws of supply and demand. If people are more willing to pay to see men play (is it totally outlandish to think that most fans find the men's games more exciting to watch?) then the prices are going to be higher. The historical statistics tell us this is true.

This also happens in hirings, where employers know the productivity of females is more likely to be hindered because of pregnancy, etc. This can cause problems, however, and create a vicious circle in which employers' beliefs are simply self-sustaining. I think we could debunk this in ticket price 'vicious circle' by simply looking at attendances at men's and women's games and understanding that low attendance at a women's game won't increase with price (unless women's basketball has lots of things in common with potatoes in Ireland).

Employer Prejudice: Well, this doesn't really apply if you ask me. The entire basketball team is a women's team and proving something like this is really difficult. We could look at coach salaries between men and women basketball, but this gets us into the same argument about supply and demand. In fact, there's precedent for this at USC and the female coach lost. The idea was that her and the men's coach had the exact same duties and responsibilities, worked just as many hours, but she got paid way less. Her frustration is understandable, but the market to which she coaches is much smaller, resulting in less revenue to pay her with. She also claimed she got fewer benefits than the men's coach (that one is a little sketchy). She lost the case. (Here's another link at USC)

Consumer Discrimination: This could be a very real phenomenon. However, disentangling it from just plain preferences for playing style or quality of play is difficult. Perhaps it's a completely misguided evaluation by fans, but I don't think we can know the answer to that unless the women's and men's team play one another in the same league.

Co-Worker Discrimination: I'm not sure how this would apply. If you count the men's team as co-workers and they're prejudiced against the women's team (definitely not unlikely), then fine. But there IS a women's team, and the men have no bearing on ticket prices of the women's games. So I think, at least in the discussion of ticket prices, this point is moot.

Most likely, if it's any of these, it's consumer discrimination. There very well could be some of that, but to suggest charging higher ticket prices for the women's games will just result in less fans. So that's stupid. As for bringing down men's prices, that would supply the department with less money to subsidize the women's team. Charging low ticket prices does not necessarily CAUSE people to de-value the sport (though the authors apparently cite studies that show this effect can happen--I'm not convinced that is going on here). The causation is probably reversed: low interest causes athletic departments to charge less in order to get more butts in the seats.

Stacey Brook has a discussion here

As for whether or not a non-profit should act like one in order to support all groups equally, that could be up for ethical/moral/political debate. I'm not convinced ticket prices should all be the same. That will simply leave athletic departments with much less than they had before. Football and basketball programs at many large NCAA school support the entire athletic department. The women's teams actually benefit from this. The whole thing seems to be backwards.

Hat Tip: The Sports Economist

Tuesday, October 20, 2009

Discrimination in NHL?

A journalist recently raised some eyebrows reviewing a new book by Bob Sirois that claims he has found significant evidence for the discrimination of French-speaking players in the NHL. I have heard this claim in the past, and have read some economic literature on the topic. While this seems to be news to the likes of Phil Birnbaum at Sabermetric Research Blog, people have been claiming this for over 20 years now with some evidence. I'm a little surprised people find this book release so shocking.

Phil doesn't believe the evidence presented in the review of the book, and with good reason. While I know very little about Sirois, the findings presented don't seem to be too satisfying (at least in a statistical sense). BUT, I'm sure he does shed some new light on the topic. Below is my comment at Sabermetric Research Blog, and if this is a topic that interests you, I'd suggest reading the papers listed at the end:

"I've seen a few papers on this topic coming out of the sports economics literature that seem to confirm the idea that French speaking players really may be discriminated against (at least in terms of salary paid when performance is supposedly even).

The Kahane paper below tries to find if there is inefficiency in that discrimination practice. It's pretty interesting. This would, of course, be expected if there is in fact discrimination taking place.

An older paper I read from 1992 attempts to explain differences through body size and defensive style of play, but I'm not sure about that (as I know nearly nothing about hockey). While generally a mixed bag of findings, the 'discriminatory' area seems to be defensemen.

The 2003 Longley paper attributes the discrimination to customers in certain areas (not that this type of discrimination makes it more right for the hockey teams if it exists).

Here are the ones I know of:
Longley (1995, 1997, 2003)

Kahane (2005)
Krashinksy (1997 for anther view)
Walsh (1988, 1992)
McLean (1992)"

If you have any sort of university search engine, those papers should be easy to find. They're from Canadian Public Policy, Journal of Economics and Sociology, Review of Industrial Organization, and Industrial and Labor Relations Review.

I guess the main difference to see about the newest Longley paper is that it attributes the discrimination to the customers, rather than the firm. If customers get less enjoyment from seeing French-speaking players on their team, then the firm has incentive not to hire those players. Unfortunately for the team, that's not a good excuse for discriminating. It's the same as only hiring white people at your upscale restaurant because you know your customers are rich racist people.

Anyway, it's an interesting topic and I'm surprised Birnbaum seems so unconvinced of the idea. There's also discussions over at The Book Blog and In the end, I don't know who is actually right. I suspect a book with 'statistics' by a former hockey player has some not-so-great arguments, but might give an interesting in-depth look at any possible direct actions taken against French-speaking players.

As suggested by one author, it could be a style of play excuse. Hockey is much more interconnected than baseball, and communication or playing style could have significant effects on how a team as a whole performs. Then again, the Kahane study seems to find pretty explicit evidence against that.

UPDATE: Phil commented that he's not against the idea of discrimination. Just wanted to make that clear. I tried to present the fact that I agree with some of the critiques of the 'evidence' provided in the book review. But he does mention that the accusation is premature, which I have to disagree with given the long history of papers investigating this topic.

NEW LINK: The Sports Economist

Monday, October 12, 2009

Rotisserie Scoring and Reality

Today I ran across this article at a random site I found on a Google search. The author's claim is that Roto leagues are just not representative of real baseball, and that Head-to-Head leagues are infinitely better. Each league type has their ups and downs, of course. He goes into a number of defenses to his claim that could generally be improved by simply adding categories to a traditional rotisserie league. He seems to miss the fact that you can penalize batter strikeouts simply by adding a category for it and reversing the roto scoring. While I agree with some points, I think others aren't very well thought out.

But this got me thinking: How representative are the 5x5 traditional categories toward which teams are actually the best in a rotisserie league?

Now, I imagine people have done this before, but I figured I'd just check it out for the recently wrapped up 2009 MLB season. I took all 30 MLB teams and ranked them in each of the 10 traditional Roto categories (R, SB, AVG, HR, RBI, ERA, WHIP, W, SV, K) and sorted them to give Roto-style discrete score rankings to each team out of 30. Finally, I took a simple correlation of the team's actual 2009 wins, and their projected number of fantasy points on a traditional rotisserie scoring. For all of MLB, the results seem pretty straight forward, as I expected:

Corr(Roto Points, 2009 Wins): 0.9276

To ensure there isn't a problem with the discrete-type scoring in the calculation of the correlation here, I calculated a Composite Z for each team just the way I presented in my guest post over at the Fantasy Ball Junkie and did the same correlation:

Corr(Composite Z, 2009 Wins): 0.9449

It should be noted that the correlation between the Composite Z and Roto Scoring in these leagues is about .98 pretty consistently. It still has the ability to find some anomolies in a standard roto format, however, so don't count it out as not useful (and it can be adjusted in creative ways to find new information). From this, it seems like the Roto Leagues are a pretty good representation of the outcomes required for a good regular season in MLB. Of course, that's not all there is to the game, and managing weekly matchups is a lot of fun, too. I prefer a combination of the two: rotisserie style head-to-head matchups. We have to keep in mind as well that a correlation doesn't tell us a very complete story, but it gives a good idea of the relationships between outcomes in fantasy baseball vs. "real" baseball. It doesn't really tell us the underlying structure or causes of anything, including 'run scoring'.

One of the other things I was curious about was how well the $$ Values (combined pitching and hitting) from Fangraphs correlated with actual wins for the 2009 MLB season. I don't actually know how the $$ values are calculated, so take them with a grain of salt. Below is what I found:

Corr(Total $$, 2009 Wins): 0.8260

Interesting! Here's the disclaimer, though: while the $$ values are theoretically measuring 'true talent', the roto categories are measuring actual outcomes from the season. The actual outcomes should usually correlate higher with the Wins, as they inherently contain the true outcome within them (especially in the W and R categories included in a Roto system). Well what about Pythagorean Record? Can we out-perform that with our Roto categories? Let's see:

Corr(Pyth Rec., 2009 Wins): 0.9051

Corr(Pyth Rec., Roto): 0.9109

So, we see that the roto points actually correlated more highly than the Pythagorean Expectation that so many people hold dearly as a quick estimator of expected wins. Of course, the Roto points are biased due to the W category. But with that, I think it's safe to say that using the Roto points is as good as using a Pythagorean Expectation to predict wins for a team overall in MLB. The difference between these correlations is negligible.

Is fantasy scoring perfect? Absolutely not. But it seems to gauge a fairly realistic level of output that we would want from pretending to be Major League Baseball general managers. The real fun is trying to predict what these players are going to do. We should use true talent measures developed by all of the projection systems out there to do that (in fact, averaging them all together sounds like your best bet). But wait! What about comparing the correlations to point-scoring leauges? Isn't the point here to show that H2H leagues aren't really significantly better at representing true baseball outcomes?

Well, here you go (based on standard CBS Sports H2H Points-Based Leagues):

Corr(H2H, W): 0.9351

So it seems like the point system here does fairly well at representing what would happen on a baseball field. I'd still be willing to argue that the correlation difference is negligible, though. I would also imagine including certain categories in a roto league, as I mentioned earlier, would help to close the extremely small gap in the relationship.

So, in sum, I think it's safe to say that both league types give relatively representative outcome measures of a fantasy team's true relative strength in the long run. However, I'm not sure that the W/L records in H2H leagues are totally representative of the true talent on each team. If standings were based on points only, that would be one thing. However, as I mention in my guest post at Fantasy Ball Junkie, the H2H season consists of a collection of very small sample sizes and asymmetrical scheduling. In those cases, H2H falls far short of most Roto formats, and there are incredibly large point swings in the new CBS scoring format that I really didn't have any fun with this year. All in all, this is simply a matter of preference, and rotisserie isn't necessarily 'just for chicken.'

NOTE: I would actually also be interested in doing this by AL/NL and Division Roto Rankings. Unfortunately, I'm swamped for the next couple months and don't have time time to separate it out 2 more times. It may be fun as an exercise for someone's curiosity, but I don't suspect finding anything too striking (maybe some adjustments, given teams only play their own-league counterparts outside of the short 'interleague play' weeks).

Sunday, October 11, 2009


It seems like this week(end) everyone has been talking about clutch hitting. It's mostly in response to JC Bradbury's response to Bill James' article "Underestimating the Fog". JC seems to think that James' article is misleading. I think he does make some good points about hypothesis testing, and as he says, it's something people wrestle with in academia all the time. But, early on in statistics or critical thinking classes, you're generally taught that you can't prove something doesn't exist. It seems fairly intuitive that, given past research on the subject, it may not be a very fruitful topic to look into at this point. My thoughts are the following (as I post at Sabernomics):

"I think the problem is that to find evidence for clutch hitting (even if there is such a thing), there would have to be some sort of inefficiency in managing strategies between the two clubs. If we assume there is a clutch hitting skill, then why wouldn’t there be a clutch pitching skill (I think you allude to something of that sort in your book, JC).

If that’s the case, then both managers should be optimizing their clutch from the defensive, as well as the offensive POV. Under this assumption, the results (or statistical data) would be a wash and there shouldn’t be significant evidence in the data for clutch hitting. If a manager doesn’t put in their so-called ‘clutchy’ guy when the other manager has in their ‘clutchy’ pitcher, then he isn’t optimizing his strategy. Unfortunately, for those trying to discern a ‘clutch’ skill, the only thing that would happen by putting in the ‘clutchy’ hitter is arriving back at the expectation that we originally had for the event.

But that doesn’t necessarily mean it’s not a repeatable skill. If, for some reason, there isn’t clutch pitching, then perhaps the idea of clutch hitting would be more manageable. Even if it were the case that it exists, I can only imagine it is quite tiny and probably not of interest in payroll as Jim states above. I think this ‘fog’ is just too thick for us to really find anything, and what could be found probably isn’t all that worth finding."

The main idea here is that, if managers are acting rationally to optimize their chances of winning in clutch situations, then we aren't likely to see a difference in the way the game plays out, on average. Why shouldn't there be clutch pitching? Someone like Mariano Rivera is referred to as a clutch pitcher. The problem is he's also just plain nasty. When a manager puts in a pinch hitter because of his clutchiness, the manager on the opposite side should be doing the same thing. This should just leave us with what we expected to happen in the first place, and doesn't leave much room for detection of anything. Any edge that a manger gets from putting in a hitter he thinks is 'clutchy' would just be offset by the other manager putting in his 'clutchy' pitcher--assuming the clutch factor is a constant increase in advantage across clutch players (or close enough to that). So while we don't detect anything, it could be an important part of the in game strategy.

With that said, I don't think there's much value in searching for the clutch factor. I think some players likely don't perform quite as well under pressure, but I'm fairly convinced that they get weeded out early on. There's always immense pressure to perform at the MLB level. If you can't handle pressure, you're not likely to be in the bigs. That's not to say that at a given point, a player in MLB doesn't fail due to pressure constraints. But on average, I don't think it's going to be anything influential over the course of the season. I'd be willing to bet that being 'unclutch' is a possibility from a psychological standpoint at lower levels of play. Unfortunately, I don't think we have the data to truly analyze that, and I don't think it's ever a reason to put a hitter in that, on average, isn't as skilled as the one already at bat.

Given a clutch situation, I'd love to have Derek Jeter at the plate. He's a damn good player and if I'm faced with that situation as a manager, I want my best player out there. If I had a choice between Jeter and Pujols, Bonds or A-Rod, well I wouldn't have to ponder too much. I'll take the guys that make hitting Major Leauge pitching look like child's play.

Addendum: I forgot to add some links about the discussion. Below are some other discussions, as well as a 'quick study' over at Sabernomics that gives a quick look at the 'effect' we might be trying to find.

Quick Study at Sabernomics

Discussion at Sabermetric Research Blog

The Blook Blog's Blurb
Note: I'm not sure why Tango thinks this isn't a 'practical problem'. Of course it is. It's trying to find the optimal way to manage, which makes it extremely practical (though probably not all that useful in the end). Just because teams don't currently rely on it, doesn't mean the motivations behind trying to find it aren't 'practical'. Maybe I'm being nitpicky with semantics, but this seems to be a point that Tango is really interested in making for some reason.

Thursday, October 8, 2009

Addicted to Baseball?

Sorry for the very scarce posting lately. I'm actually working on research projects with 3 different professors and taking 2 and a half classes right now. It hasn't made for much time here. I had a post about my fantasy season, but decided that it was simply not interesting to anyone but me, so I had trimmed it down to players that best helped or hurt my teams this year, and who may be in that position next year. Right before I was about to post, I caught this post over at Fantasy Ball Junkie and I didn't want to be a copycat.

Anyway, this post is in reference to a paper I recently read by Young Hoon Lee. Dr. Lee is an econometrician from Korea who researches sports (especially baseball), among other topics. I've been in contact with him about a few things related to GAUSS, but I haven't had extensive discussions. He's wicked smart, and he's quite a resource for econometric questions. A recent paper he released in 2008 with Trenton Smith (Washington State) discusses economic models of addiction and how Americans may actually be addicted to baseball. The addiction is in the same sense as one would be addicted to anything else. In economic terms, addictive goods are characterized by "increasing marginal utility of consumption". In non-nerd terms, that means the more you buy something, the more fun you get out of it per thing bought. So, in baseball terms, for each game you attend, the next one is even more enjoyable for you than the last. The paper goes into not only economic addiction, but anthropological and psychological theories of addiction and sport fandom as well. If you have academic access, I'd recommend reading it. Here's the citation:

Smith, T. & Lee, Y. H. (2008). Why are Americans addicted to baseball? An empirical analysis of fandom in Korea and the U.S. Contemporary Economic Policy, 26, p. 32-49.

Apparently, Koreans are not addicted to baseball, while Americans are. This is a topic I'd actually like to get my hands dirty with once I start up my dissertation and possibly extend to other sports. It really sounds like a good tie-in between Economics and Management in sport. I wonder if there are papers about this from the perspective of the participant, rather than just the fan. I know as a player, I would feel withdrawl-type symptoms (not physically, but emotionally) when I had to stop playing baseball. I still miss it, and slow-pitch softball just doesn't fill in that empty gap of competitiveness that baseball does.

Do we have any admitted 'baseball addicts' in our midst?

Thursday, October 1, 2009

NHL and Jim Balsillie

Quick link over to The Sports Economist, as they have a link to the story that a judge has ruled in favor of the NHL, rejecting Jim Balsillie's offer to buy the Phoenix Coyotes. Seems like some serious implications there. I'll leave the discussion of those up to the economists.

Monday, September 28, 2009

Brief on American Needle vs. NFL

Over at The Sports Economist, Brad Humphreys has a link to an amicus curiae brief by a number of highly regarded Sports Economists including Roger Noll, Andrew Zimbalist, and Rod Fort. All this law lingo messes with my head, so I had to look up what amicus curiae was (thank you Wikipedia). Anyway, it's a private/independent brief that highlights a lot of significant research in the field regarding antitrust and league structure in sport. If you've ever been interested in why there are salary caps, luxury taxes, revenue sharing, league level licensing, and so on, it's a good advanced introduction to these topics. Be forewarned that knowing who Coase is and a very basic understanding of microeconomic theory or policy will help with the reading.

I see a lot of debate by 'message-boarders' over these topics at ESPN, CBS, and other sites without much real understanding of what they're talking about. The discussion pretty much goes nowhere. I generally get annoyed at the misunderstanding of league policies and people pretending to know what they're talking about with such assured arrogance. If you have an opinion, present it as such. Don't act like everything you say is a fact. At this point, I ignore those discussions. If there's one thing I've learned in graduate school, it's that I don't know a damned thing and I try my best not to present myself in a pompous way. If those people annoy you as well, then I'd suggest checking out the brief. It's very informative. The brief is here.

Thursday, September 24, 2009

Disco Hayes

A couple weeks ago I had a post here about Disco Hayes, the 78 mph throwing reliever that's been dominating throughout the ranks of Kansas City's farm system. Well, he apparently writes his own blog at Greg Maddux better start writing something cool or he's going to drop a slot in my Favorite List thanks to this guy. The articles are very knowledgable and articulate. Start with the hilarious fake interview with Matt Wieters.

(Hat Tip: The Book Blog)

Non-Sports Post

Non-Sports posts should be sparse on this site and I plan to follow that rule. However, today I read one of the more articulate explanations I've heard on incentives and investment. I'm generally not a fan huge bailouts of the auto industry or investment firms that take bad risks. What does this really do for us? Responsibility is simply shifted away from those firms and no one learns their lesson. While the bank failings are bad, bailing them out doesn't make us better off in the future, and that's what we should be focusing on now. That is the general idea behind Harvard Professor Jeffrey Miron's Testimony before the House Financial Services Committee. While it's not sports, I think it's an important lesson that can be broadened to numerous places not only in society and democracy, but also the incentives in sports and sports business. Dr. Miron also has a great blog called Libertarianism, from A to Z.

Wednesday, September 23, 2009

Guest Post at Fantasy Ball Junkie

As I had mentioned in my previous post, I had a little something brewing for a new post. However, I guess now I should mention it's a link to my Guest Post over at the Fantasy Ball Junkie. It was posted quicker than expected.

Basically, I tried to develop a statistical category-based ranking system for Head-to-Head Roto-Style Scoring leagues that was independent of schedule strength, luck, and other factors that can plague these types of leagues in certain cases. This isn't an attempt to discredit the league structure, of course, as this throws in a lot of fun with the league and I love the very competitive league I'm in.

While the Composite Z-Score isn't necessarily distributionally sound, I think it can be fairly useful to gauge where luck and schedule strength altered standings in the fantasy leagues. Last year, I got the shaft in my H2H Rotisserie Style League (20-team, 8x8 scoring) and wanted to know why, despite having a fantastic team, I didn't even make the playoffs. This year I had better luck, but there was one team in particular in our league that seemed to end up with the short end of the stick. I really think it's important to understand why your team may or may not have missed the playoffs, as this can help with understanding where improvements in your strategy and roster-building can be made.

Check out the post here.

Busy Week: Interesting Links for Now

So the last week or so has been pretty busy and it's only going to get busier. The lack of posting was probably a pretty good indication of that. I have something in the works coming up for The Prince of Slides, so no worries. For now, I'll stick you with a couple links:

1. Dennis Dodd gives an interesting take on Swine Flu I hadn't thought about before over at CBS. I'd suggest not bothering to read comments by CBS readers...they're generally moronic, offensive, and/or terribly racist. While I'm not a huge Dodd fan, I'd be interested to know the economic hit the school takes by losing a BCS Championship to H1N1.

2. The Sports Economist's Brad Humphreys provides a resource for the ongoing saga that could allow NFL to be given extended antitrust exemption. I haven't followed this very closely, but probably should. The story is here.

3. My San Diego Seduction took the biggest first week loss in the Lingerie Football League, losing to the Seattle Mist 20-6. Get'em next week, girls.

4. Being a sports fan and a nerd rolled into one, I thought this story at ESPN about FBS Quarterbacks transferring to the Ivies was kind of cool. I didn't really hit my academic stride until after college and I really admire kids that look at college athletics like these guys do.

That's it for today. I have to go manage my fantasy baseball team. I'm in the Championship against our 2-time defending champion editor of Fantasy Ball Junkie and THT Fantasy Writer, Eriq Gardner. Wish me luck...I'm going to need it!

Wednesday, September 16, 2009

Business Venture: Lingerie Football League

I don't have much to say, other than: How the hell did I not know this existed? I'm really curious what kind of following this actually has or if it's even a viable business outside Pay Per View television. It's apparently an extension of a successful Super Bowl Halftime ritual. I guess I'm not creepy enough to have heard of it. The website even offers fantasy football using its players. I don't really think this is the best time, economically speaking, to have a start-up arena football league. But I hope I'm proven wrong. I think it would be more entertaining than Arena League. Here's my favorite excerpt from the Wikipedia page dedicated to the newly minted league:

"Play style is full-contact and similar to other indoor football leagues. Uniforms consist of helmets, shoulder pads, elbow pads, knee pads, sports bras, and shorts."

I'm going to choose to root for the San Diego Seduction. You think they have a line on this league in Vegas yet?

Play on, ladies. Play on.

Monday, September 14, 2009

Dallas Stars and Dynamic Demand Models

I found this story the other day on the 'Bizjournals' network. Apparently the Dallas Stars (NHL) have an advanced ticket pricing system that can be updated daily based on things like standings, the opposing team, day of the week, etc. The topic is something I am very interested in: determing dynamic models of demand for sports leagues and how they could be beneficial to both fans and teams as well as league policy. I think this is an important advancement in non-season ticket leagues (basically all but the NFL); however, I'm not sure it's that new. Teams have been known to vary their prices based on the visiting team, as well as offer deals to fans when attendance is not so great--for example, special promotions. The idea is that the team now knows when demand for their product shifts in and out. Perhaps this easily updatable ticket pricing model is more advanced than past ones. I don't really know. I'm curious to see if after the season (or multiple seasons) we could see a change in Stars single game ticket buying behavior.

But that's not really my point here. The team claims that this type of pricing, "offers great benefits to the team and its fans". I don't totally disagree with that. The first part is definitely true: a pricing model like this could be very beneficial to the team. The reason for implementing something like this is not only to find a single ticket price--which could be lower and allow more fans in the gate, or higher, which could maximize profits for the team, especially in a relatively non-competitive atmosphere where the team is a price-setter of sorts--but also so that they have the ability to price discriminate. That's what airlines do when you go to their website and you see the different levels of prices. If given the choice, I take Southwest's "Wanna Get Away" rates. It's the same damn seats for about 1/6th of the price. But as you get closer to the day of the flight, prices increase dramatically, and you might be stuck with "Business Select". They know they can do this because business trips are almost invariably planned closer to the flight than a family vacation and thus are demanded very highly right away.

Airline pricing systems are obviously more complicated than just that--in fact, airline pricing is the most advanced in pretty much any industry--but that's probably the most telling example of what these models do. They find the groups that are willing to pay more, and sell tickets for more to them, ultimately cutting into consumer surplus--or the difference between what you paid and what you were willing to pay for a ticket. That's not necessarily a benefit to the fan since the model will attempt to charge each fan the maximum they are willing to pay. As I said before, the Stars can also gauge when their demand function shifts out (for playing well, playing a popular opponenent, or whatever reason) and raise prices based on this more quickly than they were able to beforehand. More on that later.

So how does this possibly help the fans? Well the other effect the pricing model and price discrimination can have is cut into deadweight loss--or the tickets that could have been sold at a lower price, but were only offered at a 'single' price that maximized profits for the team when they were less able to gauge variation in demand among different people. Deadweight loss happens when pricing is not truly competitive or output is artificially limited. A company (monopoly) ensures the maximization of profits from a single price that is set (this is a generalization in terms of ticket pricing), which does not allow for everyone to purchase the product (assuming they cannot perfectly price discriminate). I'd argue it is the case here to a certain extent given that the Stars are the only NHL team in Dallas and comparable entertainment venues aren't perfect substitutes. There are competitors: basketball, football, and other entertainment. However, we're going to assume that the Stars can sell more seats at essentially $0 marginal cost since the seats are already built. Setting a single ticket price significantly above the marginal cost will limit output--or the number people who can come to the game if the Stars charged a lower price, but still above their cost.

Cutting into the deadweight loss is good for both fans and the team. They can do this by lowering all ticket prices, or by offering lower prices only to people that weren't attending because they didn't value the tickets so highly. The latter allows the teams and fans can come closer to reaching an efficient outcome: the team makes more money AND more fans are happy because more of them were able to attend within their budget. Fans that were already there, however, may not be getting as good of a deal when price discrimination takes place over setting a single low price.

I'd like to state here that I'm assuming the number of seats at the stadium is the maximum that could be built. Or in other words, the marginal cost of building new seats is higher than the amount team could make off of them. We'll just say the 'last fan' values the 'last seat available' too low to consider build a seat for the next fan.

Since the team already sold its season tickets to 'high-demand' fans, they don't have to worry about giving those 'high-demand' fans tickets too cheaply. They likely already have an idea at how to suck as much money out of these fans as possible. So these fans are not necessarily better off--but not necessarily worse off. And everyone that really wants single game tickets will probably buy them at the preseason price to ensure they get to attend a game. So they're not really better or worse off either. The rest of the fans are a 'mystery' (kind of). This model reduces the mysteriousness of these fans in the same way the airline pricing does. The aim here is to target different groups of fans that are still willing to pay more than $0 to attend the game, with each group placing a different value on that attendance. Since there is no real marginal cost--a generalization--to putting butts in the seats, if the model is efficient, the stadium will sell out every game and each fan will more or less pay exactly the full amount they value that ticket. But is the 'perfect' gauge of demand better for fans in all cases? Not necessarily. While more fans get to attend those games, the in-season ticket buyers that were already in attendance--and valued the ticket higher than the price--are likely going to have to pay more to go.

This model also does something else: it estimates when the value the same people place on attending changes in some way. This refers to a "shift" in demand: when everyone suddenly places more (less) value on attending a game. This could happen because of winning, the quality of opponent coming to town, or a number of things of that sort. A pure shift out in demand will cause the team to raise ticket prices to (likely) all of the groups.

Because of the limit on the number of seats, the stadium or arena could have already been selling out at a lower price implemented before the team could quickly gauge the demand shift. In this case, all the advanced demand model will do is tell the Stars to raise their ticket prices to fans. The advanced model allows the team to ensure they're not charging too low of a price to anyone.

Going from the unadvanced to the advanced model in a sellout situation--and assuming no change in demand--no more fans are getting tickets. This reduces the consumer surplus and only the consumer surplus. The only thing happening here is that certain fans are having to pay higher prices for their tickets. The same thing happens if there is a shift in demand. Higher prices to everyone that suddenly values the tickets more. While more 'efficient' economically, I wouldn't consider that to be a benefit to the fan.

So do we see "great benefits to the team and its fans"? Well, it depends. If the team wasn't selling out, and now is, new fans could benefit by getting a chance to see the team for cheaper. That's good for both the team (who marginally spends $0 on getting new butts into the seat) and the new fan (who didn't get to go before, despite having some demand for doing so). However, single ticket fans that were originally getting a 'great deal' aren't necessarily getting that anymore. So while it's more efficient, it's not necessarily 'better' for the fans.

My gut here tells me the model will gauge more about the ‘shift’ in demand, rather than the different groups to price discriminate toward. If that is the case, we still may have pricing that limits output (attendance), despite the fact that the cost to fill the additional seats is $0. Perfectly discriminating is very difficult and I doubt the model will do it perfectly. In the end, I think there may be both increased attendance from those who value tickets lower, with increased prices to certain buyers that the team can pinpoint. Whether or not you feel this is better as a fan likely depends on which of those 2 groups you consider yourself part of.

ESPN and Local Coverage

Tossing it up to JC Bradbury at Sabernomics on this one. Apparently, ESPN is getting into the local sports business through their market-specific websites. The first launch was Chicago, with Boston, LA, and New York to follow. JC has some interesting points about where the local writers will end up.

One thing I'm curious about that I don't see mentioned is whether this is a first step for ESPN to get into the local RSN business. Currently, local markets like Boston have networks such as NESN (partly owned by the Red Sox)--or WGN in Chicago--that do most of the local sports coverage. Given the resources ESPN has, and the already dominant expertise in the sports broadcasting business, I wonder if it's feasible for them to buy out companies like NESN. It would have to be worth the teams' while (especially the Red Sox or other team-owned local networks) to give up significant local advertising revenue in exchange for a contract from ESPN. Then again, ESPN would be quite a tough competitor and have some leverage to buy them out in that way. If ESPN has most of the local beat writers or announcer-types on their staff (as Bradbury suggests), I don't see it being completely out of the question for them to branch out in that way.

One concern I have is the way contracts are currently structured with the Big 4 Leagues and ESPN. I'm not read up on those, and local broadcasting could be limited for them. It would be interesting to see how an ESPN Boston Brodcast (televising Bruins and Celtics games) could legally compete with NESN while currently having contracts with MLB and the Red Sox. I guess in theory ESPN already competes with NESN for viewership. However, it's currently at a more general level, as it's not necessarily regional-specific competition. Anyone have more information on that?

Wednesday, September 9, 2009

Tampa Bay Rays and Sunburst ET

The Tampa Business Journal announced that the Rays will launch a new business marketing venture called Sunburst Entertainment Group (SEG). They have taken on responsibility to push for more events in the Trop, as well as provide sports marketing consultation. I think there's a lot of teams that could benefit from a structure like this (the Red Sox have already done it). Teams like the Indiana Pacers have claimed large losses on Conseco Fieldhouse and are begging for help from the local government. While I'm sure they overstate their losses, their attendance is way down and they are even suggesting that they may have to leave. Can you imagine? No basketball in the Hoosier state? The business model developed by the Red Sox and Rays in baseball (as well as other teams in other sports) seems like a good comprimise between receiving support from local governments and creating other sources of revenue for the team to operate on. In these times, $10 to $20 million a year is a lot of money to keep up an empty stadium 200 to 300 days of the year. Having deals that incent teams to take responsibility filling public stadiums for events other than their own sport seems like it could be beneficial for both parties.

Tuesday, September 8, 2009

Healthcare Through the Lens of Major League Baseball?

I've been busy today with the first day of classes and putting together some paperwork for advancement so I'll toss it up to Craig Calcaterra at Shysterball who provides a link to a discussion of healthcare regulation. This is an issue that I have some opinions about, but won't discuss here. A sports blog isn't the place.

The fact that the analogy is Major League Baseball is the only reason for its posting. That and because I get to add "Stupidity" to the Keyword Labels at the bottom of the post.

This article, however, is something I will present my opinion on: IT STINKS. I'm actually completely lost in trying to decipher the author's point. All I got from it was: We need to change something. Okay. Great. I don't totally disagree with that. But give me a little substance. I'm not sure he understands the workings of MLB's regulatory structure either, and stretching it like this isn't helpful to understand anything. Perhaps he's suggesting insurance companies should look to gain antitrust exemption and territorial rights? Create barriers to entry? I think Dr. Lee missed the ball on this one.

Friday, September 4, 2009

Proof That Dan Snyder Has No Soul

This morning I stumbled upon this article in the Washington Post while trying to collect some data on season ticket offerings in the NFL. Now I'll be the last one you hear whining about 'high ticket prices'. Generally, attending a sporting event (especially one like a baseball game) is a relatively cheap outing. The FCI is a load of crap in my opinion. Yes, if you take your wife and 2 kids to the Yankees game, buy 4 beers, a whole Pizza, a Jeter jersey, and a signed baseball, you're going to spend that $400 or whatever it is. But let's be realistic. I've landed weekday front row bleacher seats at Camden Yards for $15...and they came with a FREE $8 Boog's BBQ sandwich. Camden Yards is not Yankee Stadium, but they sure play (and lose to) the Yankees a lot.

Anyway, 'high' ticket prices are a separate issue from the article above. It turns out a 72 year old woman had signed a 10-year contract to purchase season tickets to Redskin games through 2017. She's a real estate agent and asked for the Skins to let her out of her contract because of obvious slow sales due to the economic downturn. They refused and sued her for $66,000+, forcing her into bankruptcy. The woman is a long time season ticket holder. I understand the need to enforce a contract, but this seems like a bad position to put yourself in when it comes to Public Relations.

Apparently the Redskins have sued 125 season ticket holders in the last 5 years that tried to get out of their deals. Perhaps many of them didn't have the forsight not to sign such long season ticket contracts (not surprising to me, I've met a lot of idiot Redskin fans growing up in the DC area). The team claims that, "For every one we sue, we make deals with half a dozen." That seems reasonable to me. Contracts are there for a reason, and you can't let just anyone jump ship on you. I know this is simply a heart-felt news story, but it's one that an owner or PR executive should pay close attention to. It seems to me that this is one they should have let go.

Given her situation, I feel like Hill could have gotten out of her contract had she fought this in court--or at least could have been required to pay significantly less. From what I know, getting season tickets to Redskins games is not easy. Those contracts (even in these times) could be replaced fairly swiftly. At least the Redskins could sell them for less and require those that backed out of the contract to simply pay the difference. And the Skins sued Hill not only for the tickets, but also interest, lawyer, and court fees. Quite a smackdown! Unfortunately, she feels that she must always pay her debts, does not 'believe in bakruptcy', and did not fight the situation. The court ruling was of course in the Redskins favor because of this.

The article gets into a lot of other details that I'll leave for everyone else to read. They get into Hill's finances, which she didn't seem to plan very well for to begin with (why does a 72 year old woman have a $5,000 mortgage and no money in savings?). Anyway, I just like to rag on Dan Snyder.

Wednesday, September 2, 2009

Baseball Helmets, Binary Choices, and a Nobel Prize Winner

Watching Baseball Tonight last night, I caught a glimpse of John Kruk and others discussing the new helmet that David Wright is wearing. The helmet is a little bit bigger and heavier, and the consensus (of the former players) seemed to be that they would definitely wear it when they played. Kruky says that now, but I suspect back in the early 90's he wouldn't have been as willing to do so. Why? Well, because they had safer helmets than they were wearing then, and as far as I know, he didn't wear them.

Anyway, I think the players should be required to wear the safer helmets (I believe they already will be in the Minor Leagues next season). There's not too much of a disadvantage to doing so, as it seems like you would be more comfortable at the plate wearing a safe helmet than one that is not so safe (Kruk mentioned comfort is a lot about safety up at the plate). So why haven't players decided to use these before? Does it really take a hit in the head to only a superstar to influence this type of change (and/or the change made that base coaches must wear helmets now). And why were base coaches so against wearing a helmet at their on-field stations even after such a tragedy? turns out this isn't such a new problem. Back in the 1969 we saw a similar situation to the Wright or Coolbaugh one in baseball today: Boston Bruins player Teddy Green took a hockey stick in his brain. Green stated vehemently that he would wear a helmet upon his return. He didn't. Was he insane?

I'm not going to go any farther with this. But the current situation is similar to the problem Hockey had for a while, and why even in the 1990's players were allowed to play without a helmet. The reason I mention the Teddy Green incident is this can be modeled as an economic problem. Nobel Prize Winner, Thomas Schelling, a Harvard Economics Professor at the time, wrote an in-depth paper that began with the Teddy Green incident called "Hockey Helmets, Concealed Weapons, and Daylight Saving: A Study of Binary Choices With Externalities" (Journal of Conflict Resolution, 1973). The paper was recommended to me by one of my labor economics professors when I asked about steroid use in his class. I'll recommend the same, but I can't say I would know about this without the help of that professor (who is probably one of the smartest people I've ever met...he's a Harvard PhD...and a hell of a pitcher on our softball team). The guy is a human library. I'll warn that the Schelling paper can get pretty dense, but the sports anecdote makes it catch your attention right away.

Anyway, just thought it was interesting given last night's BB Tonight and my recent discussion of externalities that come up in fantasy keeper leagues. This paper is another fun application, and even gets into ostracism by other players for wearing helmets, disadvantages with peripheral vision, and so on. Good stuff.