Gazing Experts, the National Economy, and Other Short Stories

Posted on October 18, 2008 by


Over the past week Henry Abbott of TrueHoop asked thirteen experts (and me) the following question:

What WILL be the big story (or stories) of the upcoming 2008-2009 NBA season be? Why?

The answers were reported at TrueHoop on Friday (Experts Gaze in to the Crystal Ball of 2008-09).  Before I get to the other answers, here is the long version of my response (Henry obviously had to edit my overly wordy response for space considerations):

My Answer

The big story in 2008-09 is likely to be the LA Lakers.   Last year the Lakers won 57 games.  The team’s efficiency differential suggested the team should have won 60 games.  Hence it was not surprising this team advanced to the NBA Finals.

It’s important to remember, though, that this team only had Andrew Bynum for 35 games.  Furthermore they only had Pau Gasol for 27 contests.  This season the Lakers will probably have Bynum and Gasol the entire season (barring any injuries).  And this means the Lakers are very likely to win more than 60 games.  A team winning more than 60 games isn’t really that unusual.  What is unusual is that the Lakers are likely to win more games than any other team in the NBA.  And this makes the Lakers the favorite to win the NBA title in 2009.

Obviously someone has to win the title, so that by itself is also not a big story.  But if Phil Jackson coaches another champion, this will give Jackson ten NBA titles as a head coach.  This mark passes Red Auerbach.

By itself, that’s a big story.  There are some additional possibilities related to Jackson winning a tenth title that make it even bigger.

  • The Boston Celtics are still expected to be the best team in the East.  I think the Lakers with Bynum, though, are better.  This means that Jackson is likely to win his 10th title against Auerbach’s Celtics.
  • To make it even more interesting, if the Lakers win the title in four or five games – and the Lakers have home-court advantage – Jackson will get his 10th title in Boston.
  • Given the age of the players on the Lakers, this could be the beginning of another Jackson led dynasty.  In fact, this could be the beginning of Jackson’s fourth three-peat (or first four-peat). 
  • If this is the beginning of another Laker dynasty, then Kobe Bryant is going to become part of the conversation when people discuss the greatest players to ever play the game.  In my view, the numbers don’t support Kobe being part of that conversation.  But if he is part of another three titles, that is where he will be.

So that, I think, will be the big story.  The Lakers win the title in 2009 and with that story are a whole host of potentially very interesting storylines.

Another Economist Answers

I was not the only economist who answered Henry’s question.  Justin Wolfers – a recently tenured economist at the University of Pennsylvania (and a very talented researcher who is often called upon to discuss important issues) – also offered a response:

In four words: the Portland Trail Blazers. After going .500 in an Oden-less season, the Trail Blazers have a lot to look forward to in 2008-09. Alongside 7-foot Greg Oden at center, Portland will have the ability to overpower their opponents with 7-foot-1 Przybilla, 6-foot-11 Aldridge, and 6-foot-11 Frye. This combination should drastically improve Portland’s defense, which ranked 21st in blocks per game and 25th in rebounds per game in 2007-08. Likewise, Portland’s offense will be one to be reckoned with as Roy, Outlaw, Webster, and Aldridge (the four Trail Blazers that averaged double-digits points last season) will see more open shots with the inside-outside offense that will result from Oden drawing double-teams down low.

The Economy?

In my response I focused on the Lakers.  Justin focused on the Trail Blazers.  A few other “experts” though mentioned something about the national economy.  Although you couldn’t tell from the response offered by Justin and myself, apparently there are some issues with the national economy at the moment.   And Mark Cuban (owner of the Mavericks), Dave Zirin (author), Keith Smart (assistant coach with Golden State), and David Thorpe (ESPN basketball analyst) all mentioned the possibility that a downturn in the economy could impact the NBA. 

Just to review…

  • the national and world economy is having some problems.
  • when asked about the big story in basketball, the two economists didn’t seem to notice the issues in the economy.
  • the non-economists, though, seemed to think the problems in the national economy might be important.

To be fair, Justin has commented on the recent upheaval at the Freakonomics blog (see When Economics and Politics Collide and Economists and Bailouts: Mea Culpa)

And much to my surprise (and I will explain what I mean by “surprise” in a moment), Martin Schmidt and I had a paper published back in 2001 (“Competitive Balance and Attendance: The Case of Major League Baseball.” published in the Journal of Sports Economics) that examined the link between changes in per-capita income and attendance in baseball.  Our analysis indicated that a 3% decline in per-capita income – which would be the biggest drop in our economy since 1950 – would lead to about 200 fewer tickets sold to each regular season game.  This is a statistically significant impact, but I am not sure constitutes a very large economic impact.  

What did I mean by “surprise”?  The aforementioned JSE article was focused on the link between competitive balance and attendance.  Per-capita income was included as a control variable in our study, and hence was not an important part of our paper.  Consequently, until Marty reminded me a few months ago, I forgot we had ever looked at the link between baseball attendance and changes in the national economy.

More on the Economy

The reason why Marty and I were discussing this rather obscure result is that a reporter – and I think it was Pablo Torre of Sports Illustrated — was asking me about the impact an economic downturn would have on sports.  I say “I think”, because the Torre article – The Changing Face of the Sports Fan – doesn’t mention the Schmidt-Berri result (I am quoted on the topic of sports as an addiction, which is a research area I know of but have not contributed to in the past). I think, though, in the course of talking to Torre (and we talked more than once across a few months), I did try and look at the link between attendance and economic growth (and this examination led to a conversation with Marty).

The Torre article does a very nice job of discussing how the current economic trouble might impact sports.  The general consensus of sports economists (and several are quoted in this article) is that sports tend to be recession resistant, although a major downturn could be a problem.

A few more notes on the impact an economic downturn might have on sports…

  • I played around with data on NBA attendance and changes in per-capita income and I wasn’t able to find much of a relationship. Of course, every economic decline in the history of the NBA has been less than 3%.
  • If we go back to the Great Depression (you can do this for baseball but not for basketball), you do see a clear impact on attendance. Of course, the economic decline during the Great Depression far exceeded 3%. So if we are headed for a very severe decline, there could be (as noted) an impact on sports.
  • And if you want even more on this topic, USA Today ran two recent articles on the subject (Economic Squeeze Play to Hit Sports and Sports Also Paying a Price Amid Struggling Economy). These articles quoted Skip Sauer (from The Sports Economist) and Andrew Zimbalist.

More Interviews

Henry Abbott at ESPN and Pablo Torre at Sports Illustrated are not the only reporters I have spoken with recently.  Here are a few more stories:

  • Rohan of At the Hive – a blog for the New Orleans Hornets – conducted an interview with me which was posted this past week. The conversation touches on The Wages of Wins, Wins Produced, and also comments on various issues that might be interesting to fans of the Hornets.
  • Curtis Jenson of the Southern Utah University Journal (our school paper) wrote a story about me joining SUU (Sports fanatic is first pick for econ professor position). The article details some of my research and also reveals that my new colleagues don’t know me that well :)
  • And as I watched Tampa Bay try and eliminate the Red Sox (are we sick of the Red Sox nation yet?), I was reminded of a story in the St. Petersburg Times last month. The story – by Stephen Nohlgren and Aaron Sharockman (Do new parks bring wins?) – discussed the impact of building a new stadium in Tampa Bay for the Rays. In this story I cast some doubt on the impact new stadiums have on team success.

One last note on stadiums… one does suspect that any economic downturn will reduce the ability of teams to get a new stadium.  And since stadiums really don’t impact economic growth (a very consistent finding in the sports economics literature), it might be good if fewer of these get built.

– DJ

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