Category: Sports

The Effect of Economic Vulnerability on Protest Participation in the National Football League

Also known as “Incentives matter”:

What distinguishes between National Football League (NFL) players who participated in protests during the National Anthem and those who did not? Does the finding of a personal vulnerability constraint in high‐risk activism apply to this relatively elite population?

Protest participation during 2017 was determined for every NFL player, along with several variables pertaining to their performance, compensation, and the political atmosphere of their team.

Bivariate and multivariate tests both reveal that protest participation was far greater among players with large guaranteed contracts and among players who were well regarded for their performance.

Economic vulnerability ranges widely within the NFL such that players hold contracts offering guaranteed payments of anywhere between $92 million and nothing at all. The data here suggest that the personal vulnerability constraint documented in protest participation research also applies to this unique population of high‐profile people engaged in a most high‐profile protest. Documenting the existence of these constraints helps offer a more systematic foundation to our understanding of political activism behavior among athletes.

That is from a newly published article by David Niven.

What Explains Labor’s Declining Share of Revenue in Major League Baseball?

Somehow I had missed this earlier paper by John Charles Bradbury:

Since the early-2000s, the share of revenue going to Major League Baseball players has been diminishing similar to the decline of labor’s share of revenue observed in the US economy. This study examines potential explanations for the decline in baseball, which may result from related factors and provide information relevant to explaining this macroeconomic trend. The results indicate that the value-added from non-player inputs, collective bargaining agreement terms, and related changes in the returns to winning contributed to the decline of players’ share of income. Competition from substitute foreign labor and physical capital are not associated with the decline in labor’s share of income in baseball.

There is also this sentence:

The decline in labor’s revenue share in MLB is consistent with changes in revenue share in the hospitality and leisure industry that experienced a decrease in labor’s share of income from 65.7 percent to 62.1 percent between 1987 and 2011 (Elsby, Hobijn, and Şahin 2013).

Another hypothesis I have heard is that baseball players are not nearly as good at, or as well-suited for, the use of social media, as compared say to the more visible basketball players.  Another (quite speculative) claim is that sabermetrics has commoditized a lot of players and in turn lowered their bargaining power.

The ongoing death of football?

From the NFL to rec leagues, football is facing a stark, new threat: an evaporating insurance market that is fundamentally altering the economics of the sport, squeezing and even killing off programs faced with higher costs and a scarcity of available coverage, an Outside the Lines investigation has found.

The NFL no longer has general liability insurance covering head trauma, according to multiple sources; just one carrier is willing to provide workers’ compensation coverage for NFL teams. Before concussion litigation roiled the NFL beginning in 2011, at least a dozen carriers occupied the insurance market for pro football, according to industry experts.

The insurance choices for football helmet manufacturers are equally slim; one helmet company executive said he was aware of only one. Pop Warner Little Scholars, which oversees 225,000 youth players, was forced to switch insurers after its longtime carrier, a subsidiary of the insurance giant AIG, refused to provide coverage without an exclusion for any neurological injury.

“People say football will never go away, but if we can’t get insurance, it will,” Jon Butler, Pop Warner’s executive director, lamented to colleagues after discovering that just one carrier was willing to cover the organization for head trauma, according to a person who was present.

Here is the full ESPN article.  It is substantive throughout, a very good piece, and hockey and soccer are having insurance troubles too.

Via John Chamberlain.

Continuous improvement, Lebron James edition

Curry and James are both taking four pull-up threes per game this season. Curry is making 45% of them. James is making 40% of them.

This wasn’t supposed to happen. James made 30% of his two pull-up threes per game in 2016. His shooting percentage ranked 19th of the 21 players who took as many of these shots as he did. He was closer to Kobe Bryant and Russell Westbrook than Curry.

There are 12 players this season with similar numbers to his. Curry is still No. 1 in terms of shooting percentage. James is now No. 2.

…James now relies on threes for nearly 30% of his shots. That percentage is by far the highest of his career. It’s also higher than Kevin Durant’s this season.

He’s not only taking more 3-pointers. He’s also taking longer 3-pointers.

Here is the full WSJ article.  Here is my earlier post on the three-point shot and the duration of the Great Stagnation.

Income risk-sharing in baseball

Pando Pooling is a startup headquartered in Palo Alto, Calif. The company’s founders, Charlie Olson and Eric Lax, met in 2015 at Stanford’s Graduate School of Business where they dreamed up an endeavor that would support people in high-volatility careers—entrepreneurs, primarily. (Pando is Latin for “I spread out,” and also refers to a colony of aspen trees, whose roots intertwine to make a massive underground network.) What if, they wondered, a large enough group of entrepreneurs pooled shares of their earnings, ensuring that each entrepreneur stood less chance of going bust? In theory this would allow entrepreneurs to take more risks in pursuing their ideas.

Olson and Lax didn’t start with entrepreneurs, though. They took their idea to a different field—literally. Just as MLB teams pool a third of their revenue to support smaller-market teams, Olson and Lax saw an opportunity to give young baseball players more security. As with entrepreneurs, only a small set of players go on to earn fortunes; many talented, driven players leave with little. (Less than 25% of first-round draft picks play more than three years in the majors.) Unlike tech founders, though, players are paid at regular intervals.

Here’s Pando’s pitch: A young player contributes a fixed share of his salary to his pool after he receives at least $1.6 million in MLB earnings. There is more than one pool, but every member in each pool must agree on every other poolmate, and Pando takes 10% of each pool. Pando recruits players through agents, financial advisers and players who have already signed with the company; Olson says he has 150 members so far. Once a player is on board, Pando then tries to match him with a handful of similar players to form a pool.

Here is the full Sports Illustrated article.  It is a longstanding puzzle why such arrangements never have taken off.  Is it some mix of adverse selection, excess optimism, too high resulting marginal tax rates, and bad PR because it is vaguely reminiscent of slavery?  Still, just think — if this could work the incentive to invest in the talent of other people would be so much higher.

Via Conor Durkin.

*Scouting and Scoring: How We Know What We Know About Baseball* (scouting bleg)

The role of reports and bureaucracy in the quantification of baseball prospects is a story that has long been obscured by a romantic notion of what scouts do and who they are.  Outside of scouting memoirs, only a handful of book-length studies of scouts exist, none of which take scouting tools and training as the central topic.  Scouts actively participate in their own mischaracterization.  Its possible to read entire memoirs of scouts without ever learning about the need to fill in a report, let alone how it is done.

That is from the forthcoming book — quite interesting — by Christopher J. Phillips. Not surprisingly, this book also discusses “scouting the scout.”

And so I ask you readers, what are the best things to read about scouts, scouting, and the scouting process?

The second cohort of Emergent Ventures winners

Here is the list of the second set of winners, in the order the grants were made, noting that the descriptions are mine not theirs:

Kelly Smith has a for-profit project to further extend a parent-run charter school system in Arizona, using Uber-like coordinating apps and “minimalist” OER methods.

Andrew L. Roberts, Northwestern University, a small grant to further his work on how sports relates to politics.

Stefan de Villiers, high school student, to create podcasts on the decisions of other high school students and how/why they become successful.

Brian Burns is working (with Samo Burja) on the history of mathematics and career networks, with special attention to the blossoming of innovation in 18th century Göttingen: “The secret to producing flourishing mathematical and scientific traditions may lie in a careful study of institutions. I will undertake this investigation and in the process uncover lost mathematical knowledge.”  Gauss, Riemann, and Hilbert!

Can Olcer is one of the two entrepreneurs behind Kosmos School, a K-12 school that exists only in virtual reality, a for-profit enterprise with an emphasis on science education.

Anonymous, working on a board game for ten years, aimed at teaching basic economics, including supply and demand and the core ideas of Ronald Coase.  The grant is for marketing the game.

Sophie Sandor is a 23-year-old Scottish film-maker making films with “noticeable themes [of] rational optimism, ambition and a rejection of the victimhood notion that millennials are prone to.”  She is also interested in making documentaries in the education space.

Nicholas Dunk has a for-profit to bring voice recognition/machine transcription to the daily tasks of doctors.  The goal is to solve paperwork problems, free up doctor time, encourage better record-keeping, and improve accuracy, all toward the end of higher quality and less expensive health care.

Lama Al Rajih, a young Saudi CS student, building Therma, among other projects, she received a travel grant to visit potential mentors.

I am very excited by this new cohort.  Here is a list of the first round of winners, and here is the underlying rationale for Emergent Ventures.  You can apply here.

Race discrimination in the NBA, alas I have long suspected this

Here is part of the abstract:

Weighted quantile regressions show evidence of consumer discrimination in that black players with high audience visibility (role and star players) experience a larger racial wage gap. The size of the share of the white population is shown to be positively correlated with the racial wage gap. No employee nor employer discrimination is found.

And:

Black players receive on average 20.5% less than their counterparts, all else equal.

Here is the paper by Candon Johnson and Eduardo Munici, via the excellent Kevin Lewis.

Why chess has remained popular, and why the internet is hard to predict

Those are the topics of my latest Bloomberg column, here is one excerpt:

It turns out that chess is oddly well-suited for a high-tech world. Chess does not make for gripping television, but the option of live viewing online, supplemented by computer analysis or personal commentary, has driven a renaissance of the game.

For one thing, computer evaluations have made watching more intelligible. Even if you barely understand chess, you can quickly get a sense of the state of play with the frequently changing numerical evaluations (“+ 2.00,” for instance, means white has a decisive advantage, whereas “0.00” signals an even position). You also can see, with each move, whether the player will choose what the computer finds best.

In essence, some of the suspenseful stupidities of low-level video games have been infused into eggheady chess. You can indulge your inner Pac Man without feeling guilty about it.

At first it was thought that online viewers would favor rapid and blitz chess, which are (as you might expect) more fast-paced. In fact, the slower games, including contests of five hours or more, have not put viewers off. If you are sitting at your office desk, you might wish to glance at the position every few minutes or so. A slower game means you can do that without missing much of the action, and yet still most of your work will get done. If the game is heading to a climax, you can pay full attention for that short period.

Fortunately, the software programs that evaluate the games and players are not yet infallible. So if Stockfish (one such program) indicates that your favorite player is far behind, you can hold out a slim hope that the software is wrong. “Creating artificial suspense” is one of the killer apps of the internet.

There is much more, including a discussion of basketball and trash talking, do read the whole thing.

Prophets of the Conversations with Tyler

From before the season started:

COWEN: The Milwaukee Bucks last year won, I believe, 44 games, and in the NBA, they were in the bottom third for the number of three-pointers attempted. Why should we think they might do better this year?

[Ben] THOMPSON: Because they had the worst coach in the league, by far, and he is gone, and now they have a new coach. They actually have the best shot profile in the entire league in the preseason, which is shooting threes or shooting shots at the rim. They are 89 percent or something like that.

They are going to have a great year. Giannis is going to win MVP. It’s going to be amazing, and we, being Bucks Twitter, is going to spend the whole time telling everyone that we were right and they were wrong.

That is from my Conversation with Ben Thompson.  The Bucks are now 9-2, and two nights ago they beat the world champion Golden State Warriors.

Why intellectuals should not be afraid to like sports

That is the topic of my latest Bloomberg column, with a focus on the NBA.  Here is one excerpt:

Earlier three-point innovators were called crazy, and maybe they were. The Phoenix Suns tried a fast-break, three-point offense from 2004 to 2010, and they didn’t break through with it. It was persistent foreign competition that finally drove the three points home, when European and other foreign teams, which tended to take more three-point shots, did surprisingly well against U.S. teams in the Olympics. Basketball thus teaches that innovation is not automatic, and it often pays to look abroad for inspiration, even if you are the top performer at any particular moment.

In addition to being a good default conversation topic, sports also keep us in touch with strands of American life that many of us may not encounter otherwise. Following basketball gives me new entry points into rap music, sneaker contracts, college athletics, gifs, the economics of television, even Twitter; it also helped me diagnose an injury a few years ago, when I pulled both of my rotator cuffs and knew immediately how to deal with it. A lot of the American debate over race, and over protest and proper public behavior, has played out through the medium of sports.

By the way, I have no forecasts for the NBA this year other than the trivial.  As for the Lakers and LBJ, I suppose I pick them to come in seventh or so, but to go down in the first round of the playoffs.

The future of football, revisited

On one hand:

Ratings for regular-season games fell 17 percent over the past two years, according to Nielsen, and after one week of play in the new season, viewership has been flat. February marked the third-straight year of audience decline for the Super Bowl and the smallest audience since 2009. Youth participation in tackle football, meanwhile, has declined by nearly 22 percent since 2012 in the face of an emerging scientific consensus that the game destroys the brains of its players.

On the other hand, how many other focal experiences are left:

Yet even a middling franchise, the Carolina Panthers, sold in May for a league record  $2.3 billion. Advertisers spent a record $4.6 billion for spots during NFL games last season, as well as an all-time high $5.24 million per 30 seconds of Super Bowl time. The reason is clear: In 2017, 37 of the top 50 broadcasts on U.S. television were NFL games, including four of the top five.

The Green Bay Packers, the only NFL team that shares financial statements with the public, has posted revenue increases for 15 straight seasons. Leaguewide revenue has grown more than 47 percent since 2012. Commissioner Roger Goodell’s official target is $25 billion in revenue by 2027, or roughly 6 percent annual growth.

“The business of the NFL is very strong and continues to get stronger,” says Marc Ganis, president of the consulting firm Sportscorp Ltd., and an unofficial surrogate for league owners.

But what will happen if the number of brain damage cases continues to rise?  Here is more from Ira Boudway and Eben Novy-Williams at Bloomberg.

For the pointer I thank Ray Lopez.

Height, size, and tennis

Five of the 16 men in the fourth round of singles at the United States Open are at least 6-5, and seven of the 16 women are at least 5-10…

The serve is the aspect in which undersized players most feel the height gap — they do not get to hit down on the ball and thus cannot generate the same power as taller players.

In earlier decades height was not nearly as important for tennis success.  Yet:

Returning serve is one area in which shorter players tend to be better than the largest of their counterparts…

Flipkens said shorter players had to learn to analyze the game better, reading their opponent’s tosses to make the most of their return opportunities.

Austin said, “Anticipation is not an overt skill, but it is crucial to develop.”

Once the ball is in play, smaller players frequently rely on superior speed. “Everybody is taller than me,” the 5-1 Kurumi Nara said, “so I try to move well and more quickly than the other person.”

While bigger players are getting more agile, most still are not light on their feet. Low balls at the feet make them uncomfortable.

Glushko said taller players “don’t like the ball hit into the body,” and that applies to serves too.

Smaller players like Siegemund said the best tactic was to stand further back, allowing them to run down more balls — and to let the balls come down to a more manageable height. But to play defense and extend rallies, Seigemund said, smaller players must stay in top shape.

“All the players are fit, but we have to be fitter,” she said.

Some say the opposite approach may be more helpful. “The whole point of tennis is to rob your opponent of time,” Austin said. “You can do that with raw power or by hitting the ball early. Shorter players need to take the ball extra early.”

That is from Stuart Miller at the NYT.  In addition to having some interest in tennis, I wonder to what extent this is a property of achievement in general.  As the logic of meritocracy advances, and the pool of talent is searched more efficiently, perhaps individuals with a clear natural advantage — whether size, smarts, or something else — become a larger percentage of top achievers.  Yet those wonderful “natural athletes” will have their weaknesses, just as Shaquille O’Neal had hands too large for the effective shooting of free throws.  So a second but smaller tier opens up for individuals who have the smarts, versatility, and “training mentality” to fill in the gaps left open by the weaknesses of the most gifted.  Who are the “taller” and “shorter” players in the economics profession?  Politics?  The world of tech?  Are there any “short players” left in the top ranks of the world of chess?  I don’t think so.

And maybe, for these reasons, late growth spurts are a source of competitive advantage?

eSports update

In case you’ve been sleeping:

Tournament prize pools now rival those for some of the biggest events in traditional sports, and global audiences for some big gaming events have surpassed 100 million viewers, driven largely by esports’ exploding popularity in Asia.

The lion’s share of esports revenue comes from corporate sponsorships, according to industry analysis firm Newzoo, with ticket sales, merchandising and broadcasting rights bringing in additional revenue. Newzoo estimates that esports will generate $345 million in revenue in North America this year, in addition to more than half a billion dollars in revenue overseas.

You will note that total is much less than for major league football or baseball, which exceed $10 billion each.  Still, “more service for less gdp” is a common theme in the internet economy.  Consider this:

The 2017 League of Legends world championship, held in Beijing, drew a peak of over 106 million viewers, over 98 percent of whom watched from within China, according to industry analyst Esports Charts. That’s roughly on par with the audience for the 2018 Super Bowl.

In other words, the nation without the traditional “locked in” major sport franchises is choosing to jump to eSports.  And:

This year’s total DOTA 2 championship audience was roughly the same size as the total number tuning into the Kentucky Derby, and considerably larger than the peak Wimbledon, Daytona 500, U.S. Open or Tour de France audiences.

All of a sudden, more and more of the world is “stuff I never really heard of before.”

Here is more from Christopher Ingraham at Wonkblog.