Avoiding Work on Tuesday

Posted on July 24, 2007 by


My general rule is that I post at most once a day. Although I am tempted to do more than this, my job as a professor (for which I am paid by the state of California) is about teaching and research. For nine months of the year I teach and in the summer I focus on research. Yes, blogging is fun. But I don’t think it qualifies as research (or teaching).

Unfortunately my one entry a day rule means that some issues don’t get addressed very quickly. Since I didn’t post yesterday, I thought I would break my rule this afternoon and post a few quick notes on some stuff I’ve missed.

Is the NBA burning?

Bill Simmons posted a lengthy Page Two column at ESPN.com yesterday. The column — entitled “One man out, one league in trouble” – finished with the following statement:

Let’s just hope we’re not watching a documentary about the death of the NBA some day, because we’re headed that way. Wake up, fellas. Rome is burning.

I commented on this issue at both The Sports Economist and in this forum. Let me throw out a few facts on the NBA.

Let’s start with attendance. The past three seasons the NBA has set an attendance record each year. More people are going to NBA games than ever before.

Then there is television. Brian Goff, my fellow sports economist at the Sports Economist, noted that television ratings for the NBA Finals peaked in 1998. Since then, ratings for the Finals have declined dramatically.

But I don’t think ratings are the story here. What matters is what cable television and the networks are paying the NBA for the right to broadcast these games. As reported by Sports Illustrated.com, last month the NBA extended its deal with TNT, ABC, and ESPN. The extension calls for the NBA to be paid $7.44 billion over eight seasons (beginning in 2008-09 and ending in 2015-16). That works out to $930 per season and for each team, $31,000,000 each year before a single ticket is sold.

Compare these numbers to the 1997-98 season, when the ratings for the Finals peaked. According to InsideHoops.com, in 1997-98 each NBA team earned a little more than $11 million per team from the national cable and network television contracts. In a bit more than ten seasons, this payment has now about tripled.

But why have ratings declined? I think people need to look at two issues. There is just a whole lot more on TV than there was in the past and increased competition will lead to a decline in demand. Furthermore, the NBA has put a whole lot more games on TV. As we saw with in other sports (like college football), when you increase the supply of games, ratings for any one game will decline. Of course the networks are aware of the ratings issue and must not be too concerned. Well, if they are, paying the NBA more than $7 billion over eight years is an odd way of expressing this concern.

Beyond attendance and TV, I also want to look at the salary cap. The cap is set according to the stream of Basketball Related Income (see the NBA Salary Cap FAQ for more information). According to InsideHoops.com , the salary cap in 1997-98 stood at $26.9 million. For 2007-08 it is set at $55.63 million. In other words, when we consider Basketball Related Income, the NBA has never been better off.

When we look at attendance, TV revenue, and what we learn from the growth in the salary cap, we see a league that is doing better than it ever has in its history. And yet we hear that one referee having a gambling problem is going to bring down the league.

The gambling issue is one of integrity. If people believe games are fixed, or not honest, demand will decline. At least that’s the story we are being told. Of course, the media also told us that if labor disputes take the games away, fans will never come back (and The Wages of Wins and our own published research have demonstrated the problem with the labor disputes story). So apparently, cries that the “sky is falling” haven’t been accurate predictors in the past.

Again I will repeat what I said on Sunday. The real issue is the integrity of the press. When you sensationalize every story your credibility declines. Everything that happens is not the most important event to ever happen in our lives. Please, try and have just a little perspective. Yes, I understand the incentives people face. You want people to read your column and you can do this be making everything sensational. But isn’t there just a tiny amount of interest in getting the story right?

David Lee vs. Kobe Bryant

Yesterday morning I got an e-mail from Owen Breck (who you will note often leaves comments in this forum) alerting me to a comment on The Wages of Wins posted at Knickerblogger.com. The comment — entitled “Trading David Lee for Kobe Bryant Straight-Up: Shrewd Sabermetrics or Laugh Test Flunkie?” — argues that since Wins Produced indicates that David Lee is more productive than Kobe Bryant, and “everyone” knows that isn’t true, Wins Produced is not a very good measure of performance.

Owen has done his best to respond to this argument, but I told him I would ask other readers of The Wages of Wins Journal to chime in. So if you get a chance, read the Knickerblogger essay and leave a comment here (or there). I would love to see what everyone thinks of this essay.

The Position Adjustment and Matthew Yglesias

Two weeks ago I posted a column entitled “Rewarding David Lee.” At the end of this post I said “I also wish to offer a response to the latest comment on position adjustments from Matthew Yglesias. That, though, is going to have to wait until tomorrow (at the earliest).”

Well, tomorrow has come and gone and I still haven’t responded. Let me post what Yglesias said (which has a link to what I originally said).

What are your thoughts on the point Yglesias is making? It seems to me, having read this several times, that he’s not making a point that is dramatically different from what he said when he raised this issue the first time. So I am not sure how to respond other than to repeat what I said earlier (which is just a bit silly). Then again, maybe I am missing something. Regardless, I need to end this post and get back to work.

– DJ

Oh, here is what Yglesias said two weeks ago. Again, comments are always welcomed.

I feel like Dave Berri’s missing my point here: “Now we have the argument that the value of Lewis should not depend upon position played. The numbers tell us that playing Lewis at power forward will cost Orlando rebounds. But we should ignore this fact and simply give Lewis extra credit for making an effort.”

No. This is what I’m saying. Suppose you have two players. One is Rashard Lewis, excellent small forward (according to Berri’s numbers) and average power forward (again, according to Berri’s numbers). Now you have a second player. Call him “Lashard Rewis.” Rewis puts up Lewis’ exact same numbers, but if his coach tries to insert him as a power forward he refuses to play. Which player is better to sign — Lewis or Rewis? Berri says it’s Rewis — Rewis will have a better position-adjusted Wins Produced number. I say — and basic common sense says — it’s Lewis.

In any situation where Rewis could help the team win by playing small forward, Lewis can do it, too. But some situations will arise (suppose your starting power forward has fouled out and your backup power forward sucks, while your backup small forward is an above average player) where Lewis is a more useful player to have on your roster. It’s true that teams employing Lewis do well to remember that he’s much more effective as a small forward than as a power forward (assuming that’s true) but it’s also true that it’s better — more useful to your coach and GM — to be able to “play out of position” with a modicum of success than to be totally useless.

That said, it’s slightly absurd to even discuss positional matchups within the Wins Produced framework because it doesn’t deal with defensive matchups at all. Is Player X quick enough to “downsize” and stay with his man? Is he tall and strong enough to “upsize” and not get pushed around? The Wins Produced framework doesn’t differentiate between (very useful) players who can guard multiple positions, and (unfortunate) players who defend two positions because they’re equally ineffective at both spots.