The Basketball Eye-Test vs. Analytics

As the NCAA tournament nears an end (RIP to my bracket and Kentucky) talk of the NBA, it’s upcoming draft and which college players have a skill set that will translate to the NBA is beginning to heat up. The analysis of college players is usually a combination of simple statistics (height, weight, age, shooting percentage, position, etc.), style of play and potential to improve. Still, as of late advanced statistics, some of which consider the pace of play of a college team, true shooting percentage (which factors in three point attempts that typically lower a players field goal percentage), and their Player Efficiency Rating have been used to analyze the impact of prospects on games and how this forecasts NBA success. The recent development of advanced statistics have been embraced by some parties and greatly criticized by others (Charles Barkley has been an outspoken critic). In many ways basketball is now fighting somewhat of an information cascade. For many years prospects have simply been analyzed based off of how decision makers judged their skill sets and measurable traits (vertical leap, height, passing, scoring, defensive ability, etc.), however now decision makers are finding ways to put these measurable traits into numbers which judge how these traits are influencing the game and just how good a player is. However with growing popularity of advanced statistics there is a new crowd being developed which decision makers are investigating on whether it is worth following. The greatest most sensible objection to statistics in basketball is that basketball is a sport which has very few isolated plays and accounting for externalities to these statistics is almost impossible. On the other hand, these stats have done a good job forecasting a player’s ability in enough cases that it has started a debate. In my opinion of course use advanced statistics but they must be contextualized and are probably most effective when judging marginal or “role” players who are not the main piece of the team as it quite easy to see who the great players/super stars are. Advanced statistics can be used to see what players are compatible with great players whose talents are great enough to make up for the weaknesses of their teammates and have a skill set that is great enough to highlight specific talents of other players (LeBron James, Kevin Durant, Steph Curry, James Harden to name a few). Granted there are not enough of these superstar players to go around, so teams devoid of superstars can build great teams using advanced metrics to put a wide variety of players with skill sets that can compliment one another (a la the Atlanta Hawks) in hopes of getting the most out of each player. In short, the best option is to merge both the use of statistics and advanced stats to determine how to put together a good NBA team

http://patternofbasketball.blogspot.com/2015/02/the-eye-test-debate.html — here is a link that makes a pretty good argument

No One Man Should Have All That Power

As I read through chapter 12 and thought about power, Nash bargaining equilibrium, and the Ultimatum Game I couldn’t help but to immediately think about 50 Cent’s TV series on SHOWTIME Power and also the popular HBO series “The Wire.” In the spirit of economics I’ll begin with some assumptions that are generalizations and more than likely will have some holes, but for the sake of the post and making sure every reader understands bear with me! First assumption, none of the readers have seen Power, my second assumption, only a few of you watched “The Wire.” Consequently, I’ll give a brief overview. Power- a drug dealer in attempts to launder his money opens a club in New York. As his club becomes more successful he sees this as a way to get out of the drug game and puts more efforts into making the club profitable much to the dismay of his wife and close friends. A shooting in his club at the end of the first season forces him to focus on selling drugs as a main source of income. The Wire – A show that focuses on Baltimore drug dealers and the relationship with the city’s infrastructure (police, unions, school district, politics, and newspaper/media). In essence, both shows have a focus on drugs and crime, but economically speaking black markets.

In regards to bargaining and power in networks, there is one scene in The Wire that I found to be hilarious and entertaining and explains power. In the final season, Marlo Stanfield replaces Avon Barksdale as the West Side of Baltimore’s major drug kingpin as Barksdale has been indicted and sentenced to a long jail sentence (however, prior to going to jail Marlo was beginning to overtake Barksdale). As Marlo is rising in the ranks he joins a co-op featuring all of the prominent Baltimore drug dealers. In this co-op the drug dealers work together with their drug connect named who is able to supply the dealers who control various sections of Baltimore with a low price in bulk, while the drug dealers are able to keep the police off of them because they are keeping murders down by working together. Initially, Marlo resisted joining the co-op as he saw all forms of competition as his enemy and reluctantly joined solely because of guarantees of lower prices as he gained more of Barksdale’s territory. However, when Barksdale (who also hated the co-op) is in jail, Marlo pays (literally and pun intended just wait for it) Barksdale a visit in hopes of getting his connect who supplied him with drugs. After Marlo agrees to pay Barksdale’s mom 100,000, Barksdale arranges a meeting between Marlo and his supplier named “The Greek.” After numerous meetings and payments, Marlo gains the trust the Greek and has a direct connection to a supplier who will sell him large quantities of drugs at a wholesale price, thus Marlo no longer needs the co-op. Still, the co-op has a separate connect, but only one man Proposition Joe has the relationship which allows for all of the drug dealers to get the wholesale price. Unsurprisingly, Marlo then kills Proposition Joe calls the co-op to meet in which he informs the other dealers he has killed Joe and has a new connect, so in order to get drugs you must come through him. You can see the exact scene here Marlo is the guy in the black shirt controlling the meeting https://www.youtube.com/watch?v=aT7TxMaZ4eM .

While the majority of my post explained Power and the Wire, the underlying factor I found interesting is the importance of power in black markets where relationships negotiations on “who” to know are equally as important as the good being sold. These networks are contingent upon bridges connecting components as we discussed a the beginning of the year. Until this chapter I had not truly considered the power aspect or the dependence and exclusion that are brought up in chapter 12. If this clip interests you I suggest watching the entire series!

Valuations and the NFL Draft

While the article attached doesn’t specifically mention economics or markets, as I read to procrastinate doing actual work, the article reminded me a bit of the topics from Chapter 10 in which we discussed valuations, optimal assignments, prices and payoffs, and market clearing prices. While the NFL Draft does not take place until late April and concludes in early May; the process of evaluating prospects and team needs begins shortly after the conclusion of the NFL season and amplifies as the NFL Draft Combine and as colleges host “pro days” to showcase their draft eligible players in front of college scouts.

From these workouts and pro days, draft analysts begin to create “Big Boards” or rankings of draft prospects from best to worst. Interestingly, quite often we see teams not draft based off of which player is the “best,” but rather search to find the best player at the position in which they need the most help. For example, there are some analysts who rate quarterback prospect Jameis Winston as the best quarterback prospect in the last ten years of the draft and coincidentally the Tampa Bay Buccaneers who have the first overall pick are weak at the quarterback position will more than likely draft Winston. Still, three years ago, when there were two highly rated quarterbacks Andrew Luck and Robert Griffin III, the team holding the second pick, the St. Louis Rams, did not “need” a quarterback as they drafted one with the first overall pick in a draft two years before. Consequently, they did not value RGIII as highly as other teams and traded the pick away for a collection of picks in the same draft and future drafts to the Washington Redskins who not only thought Griffin would be a future superstar, but also valued the position to pick second more than the Rams, as the team selecting third also could potentially select Griffin before Washington had the opportunity to.

To connect this to valuations and optimal assignments depending on how a values a draft prospect in relation to other teams value of the same prospect and relative to their draft position, a team may decide to pick the player or trade the draft pick. In the event that multiple teams have similar aspirations for a pick, the team holding the desired draft slot will continue to raise the price (or combination of players and picks needed to attain the pick) until there is only one buyer willing to pay for the pick and thus the market is cleared and a perfect match of one seller and one buyer. The defending Super Bowl Champion New England Patriots have a reputation for stockpiling draft picks by trading their highest pick to gain a collection of lower picks and thus draft more players. Attached is an article on both team needs for the upcoming draft and how teams should value the top prospects and a sheet which displays a trade formula and assigns a point value to each pick in the draft. The sheet shows the combination of picks a team usually has to trade in order to gain a desired higher draft position.

http://www.nfl.com/news/story/0ap3000000407751/article/2015-nfl-draft-order-top-three-needs-for-all-32-teams

http://walterfootball.com/draftchart.php

You Might Know . . . (Homophily)

Below is an interesting article on homophily published by the New York Times in 2006. In essence, the Times looks at the many topics homophily is being used to interrogate (dating, friendship circles, buying preferences) and how social networks were using homophily on their sites. The article concludes by questioning if homophily on the Internet was positive and offers an alternative site which aims to put people who do not have much in common together.

Nine years later, we still see social networks using homophily; especially Twitter and Facebook with their “You Should Follow” and “You May Also Know” features. These features not only connect you with people you know, but also make it more likely for you to continue to use the social network as it will consistently be updated with information that is relevant to your real life. While using social media to meet people with different interests sounds interesting, constantly having updates about people you don’t know or have little to nothing in common with does not seem like it will keep your interest. Moreover, dating someone who has little in common with you also seems unappealing. In many ways, it’s homophily that has allowed social networks to work. They have found ways to connect you with people you already know or those with similar interests.

http://www.nytimes.com/2006/12/10/magazine/10Section2a.t-4.html?_r=0