Steve Walters is busy grading and I am still working. But I don’t want the Wages of Wins Journal to remain un-updated (is that a word?) for too long. Originally I intended the following to be a Keeping Score column for the New York Times. But as you will see, it’s not very good. Luckily, when it comes to editorial standards, The Wages of Wins Journal sets the bar very, very, very low.
Basically I think the following is based on a great story. Players in the NBA have already been paid so the playoffs are mostly volunteer work. Yes, some are playing for future contracts, but I don’t think that story explains why veterans like Jason Kidd try so hard to win these games.
The proceeding two sentences capture the essence of this story. A Keeping Score column requires 600-800 words, and when I tried to stretch this tale out that far it fell apart.
So as you read the following, think about how this story could have been told better. I worked on it for a couple of hours and this was the best I could do.
For the Love of the Game
One of the enduring images in NBA playoff history is Willis Reed walking down the tunnel before game seven of the 1970 NBA Finals. In game five of that series Reed suffered a torn muscle in his thigh. This injury kept him out of game six, which the LA Lakers easily won by 22 points. Given the Lakers dominance in game six, it seemed unlikely that the Knicks could prevail in the deciding contest. Yet just before tip-off, though, Reed limped out on to the court. Playing on only one good leg, Reed’s efforts inspired the New York Knicks to their first NBA Championship.
Reed was the MVP of the 1969-70 season, his sixth season in the league. For his efforts he was paid $135,000. In today’s dollars, this is about $715,000. Certainly this is a good living, but relative to the money in today’s NBA, Reed was not paid very well. The average NBA player earns $4 million a year. A six year veteran earns more than $900,000, or more than Reed earned in his MVP season of 1969-70.
Looking back on Reed’s heroics one might wonder if today’s players would make the same sacrifice. The money basketball players make today leads some to question the player’s motives. Are the players playing for the love of the game, or for the love of money? If it is love of money, can we ever expect to see one of today’s players hobble out on one leg for the good of his team?
The NBA paid its players $1.8 billion this year. This works out to $4 million per player. And if a player plays all 82 games, about $50,000 per contest. But there is a little known fact to consider as we enjoy the 2007 NBA playoffs. The entire $1.8 billion has already been paid to the players. Players in the NBA are only paid for the regular season. The playoffs, which will last for two months, are strictly unpaid overtime.
Well, its not entirely unpaid. There is a pool of money the NBA gives its teams. The entire pool is $10 million. And no, that is not $10 million per player. It is $10 million for every team. And this money is split not just across the players, but also given to coaches and staff employed by each team.
This $10 million is allocated according to where a team finished in the regular season, and also how far the team advances in the playoffs. In looking at this pool it is important to separate those factors that are determined by regular season performance – where the players were paid $1.8 billion in salary – and playoff performance, where players are paid out of the pool.
Team’s earn bonuses for having the best record in the league, the conference, or one of the top six records in each conference. Teams also are paid for appearing in the first round. It is important to note that the first round money is not about succeeding in the first round. The Miami Heat, Orlando Magic, and Washington Wizards each lost all four games in the first round and were eliminated. These teams will all get the same bonus earned by the Rockets who lost in seven.
The pool allocated for place of finish and the first round is $4.3 million. Again, teams earn this because of what they did in the regular season, not for performing in the playoffs.
Once we move past the first round teams are starting to earn their allocation from the post-season pool. For participating in the conference semi-finals a team will be paid $177,579. If this money was divided among the 15 players on the roster, each player would take home less than $12,000. Given that a team must play at least 8 games to collect the money, per game each player is earning less than $1,500.
If a team makes it to the conference finals, a bonus of $293, 447 is earned. Again at least four more games have to be played. Still, the per game payment increases to about $2,600.
Taking the conference championship lands a team in the NBA Finals. The losing team in the Finals earns a bonus of $1.17 million. The winning team takes home $1.77 million.
If we put together the pay-out to the conference semi-finals, conference finals, and NBA Finals, we see that an NBA champion earns a bonus of $2.2 million.
To earn this money, though, a team must play a minimum of 16 contests. So per game, this is only $140,123. Again, this gets divided among the players, coaches, and staff. If it is just divided across 15 players, that works out to only $9.342 per game.
What if you win the title but take the maximum 28 games to accomplish this feat? Now your per game payment is only $5,338, or about 10% of what an average player earns per game in the regular season.
To put this in perspective, again we note that the minimum wage in the NBA for a six year veteran is $932,015. Per game, this works out to $11,366 across an 82 game schedule.
What does all this mean?
Players are not paid much – by NBA standards – to play in the playoffs. Yet we still see Lamar Odom playing with a hyper extended elbow and torn shoulder cartilage. Jason Kidd is playing with a bruised left knee. Dwyane Wade rushed back to action with a dislocated shoulder.
Why did these players put their bodies on the line in the playoffs? As we see, its not about the money. Just like Willis Reed 37 years ago, players today are still playing for the love of the game.
Well, that was the column. Let me know what you think. Although I don’t have time at the moment to respond to all the comments, I enjoy reading these. Hopefully I will be back to regular posting by the end of the week. At least, that’s my plan.
– DJ
Wages of Wins Journal 
Steve Walters
May 6, 2007
Actually, Dave, I thought that was a superbly written and very informative piece.
It also explains why the Celtics are not in the playoffs: incentives are inadequate and they’re economically rational. It’s not that they suck–they refuse to be exploited by The Man.
MT
May 7, 2007
That was great! Both as a fan and as a proponent of behavioral economics, I really enjoyed it.
andy
May 7, 2007
it’s very very telling, good article!
DJ CC
May 7, 2007
Not too shabby. Actually opens up a nice little window into the playoffs. Although, I’m thinking that players may have bonuses written into their contracts, ala Larry Hughes and his quest for an extra 2 Million if the Cavs won 49 or more games. But that also depends on your team – if the Pistons, yeah. GSW, pro’lly not.
I’m out like Voltron Reeboks.
Justin
May 7, 2007
Just a superbly written article. A lot of research and thought, and a different perspective than you hear from the grumpy old men on shows like ‘Around the Horn’ and ‘The Sports Reporters.’…. why am I a journalism student again?
bob
May 7, 2007
interesting article. a couple of things to think about.
1) i know that in football and baseball, many of the top players have playoff performance based incentives. i don’t seem to hear about that much in basketball however, so your argument may still hold true if this is a less common practice in the NBA. however, it seems unlikely that at least the very top superstars don’t have these things in their contract.
2) i’m not entirely convinced that players have no monetary incentive to play hard and win in the playoffs. as dwyane wade can tell you, playoff performances can put you on the map. i doubt sincerely that he would be doing lame t-mobile commercials had miami not won the title last year. there is also the question of future contract, and you can look tim thomas’ parlaying his performance in last year’s playoff into a contract that we now know was way above his actual value to a team.
i’m not saying that these players don’t play with a little extra drive in the playoffs, because they most certainly do, but the assertion that money has no real motivating effect seems a bit of a reach in the post-jordan marketing era.
Yi
May 8, 2007
hey, great article!
I would also like to point out that if the playoff bonus is evenly distributed among players, then there is no financial incentive (save playing for contracts) for an individual to perform at a higher level… if your 3rd string 1.5PPG buddy off the bench makes as much as you do for winning a series, why work so hard?
Of course, that’s purely theoretical – there’s social and psychological reasons for playing hard as well as the satisfaction one gets for winning a championship. But, I still think it’s interesting to look at the playoffs in this way.
tangotiger
May 8, 2007
Ted Lindsay, hockey hall of famer from 50 years ago, who tried to start the first union once said something to the effect of: “Heck, I’d play this game for nothing. But if someone is selling tickets to see my a–, I want my share”.
There’s no question that all these players would play for nothing, and in the hockey playoffs, where it’s much bigger grind, that’s pretty much what they play for. They also have alot of international tournaments, and again, players play for nothing and they go all out.
I think the NBA players (Americans anyway) fall short on considering that part glory.
Ed The Sports Fan
May 11, 2008
This is a very good read, I think that players are trying to get that cake, bottom line. Most players know that if they are successful in the playoffs that they can get that payday if they are free agents, which you pointed out earlier. Good one.
-Ed.
http://www.edthesportsfan.com