Jonathan Falk writes:
I [Falk] am always amazed at the amount of (digital) ink spilled on the perverse incentives involved in taking to get the #1 draft pick. The current local woes of the Giants and Jets obviously contribute a lot to these discussions, but they happen all the time. As an economist, it’s clear to me that the value of a draft pick is the incremental value, not the absolute value. I’m completely aware that the upper tails of distributions have much more dispersion than the center, or even the 80th-90th percentile does, but the fulminations over the #1 pick still seem overheated to me.
First, of course, is the fact that assessment is made with error, and there are plenty of #1 busts in every sport. #2s can be busts as well, of course, but that merely lowers the expected difference between #1 and #2 as the true value of both is attenuated towards 0 — #1 loses more.
Second, there is the issue of team fit. Greatness is a vector, not a number, and if the teams ahead of you in draft order need something else, you still stand a chance of getting the player optimized for your needs. Going the other way, of course, is that higher draft picks absolutely lower the number of teams that can steal your guy.
Third, teams are… teams. One person can only contribute so much. So the relevant assessment is now how much better A is than B, but how much the addition of A versus the addition of B will change the prospects of your team — which I think is pretty obviously a lower difference, though I guess your rationale for voting runs in the other direction — you ought to judge a small incremental addition by the gigantic difference between winning a championship or not.
Fourth, more narrowly economic, every incrementally pick costs more. I don’t think that effect is huge in the context of overall payrolls, but isn’t that then another anomaly? If #1 picks are so dramatically better than, say, #5 picks, why aren’t they paid multiples more?
I don’t really have anything to say here, because I have no sense of how much teams are paying for #1 or #2 picks. I do remember a couple years ago that everyone was talking bout Wemby, but basketball’s different than football because there are only 5 players on the court, so one player can make more of a difference.
The case of Wemby makes me think that one way this could be studied would be to compare different years. In some years there is a clear consensus #1 pick, other years not.
I guess it can depend on the particular draft. As a Dodgers fan, I can recall that the Dodgers had the #2 pick in the 1993 draft. The consensus #1 pick that year was Darren Dreifort, whom they took. The consensus #1 was Alex Rodriguez.
>Third, teams are… teams. One person can only contribute so much
This is an odd take for an economist. The margins matter a lot, esp when we are talking about elite competition. Also, for a particular team, a #1 pick might allow them to address a particularly acute weakness. If the #1 guy is a linebacker, and the next best linebacker is #25, that #1 pick can be worth a lot to a team with lousy linebackers.
Draft picks have a set contract amount that depends on which pick it is. So you can’t pay the number 1 pick way more than the number 2 pick.
I found myself thinking along similar lines yesterday during the Kentucky Derby. I wonder whether the popular favorite might not attract supporters based on publicity and the human desire to conform to the majority at least in part rather than a pure objective assessment of the horse’s strength. Consequently, the payoff for betting the favorite is diluted by these factors. The smart move might be to avoid the public favorite and bet on a 23:1 horse. I haven’t analyzed all the data around horse racing, and my hypothesis might well be off.
The NBA #1 draft picks contain some players who will be extremely impactful like Wenbamyama, Cooper Flagg, and Cade Cunningham, but some who seem to have less value like Zion Williamson. And Zaccharie Risacher, the 2024 number one, seems destined to be a trivia question answer.
Oncodoc:
Regarding horse racing, I haven’t looked at the data myself but there’s a famous favorite-longshot bias whereby it’s better in terms of expected value to bet on the favorite. On average, longshots are for suckers.
The problem for the NFL and NBA isn’t tanking for a season or two—sometimes teams are bad for natural cyclical reasons or for random ones, like the injury to a key player. The problem is that the draft order mechanism or lottery means that “being consistently bad” appears to be a valid and profitable business strategy for team owners in the long term. Soccer (at least outside the US) solves this by relegating bad teams. Without relegation, there’s nothing to stop a team owner from deciding he’d rather not spend money on players or coaching, get cheap talent through the draft, and just be mediocre but profitable indefinitely, but that makes the whole league’s product worse.
Sorry didn’t mean to post that as a reply to a previous comment!
Perhaps the thing that careful quantitative analysis of sports gets wrong is that so much of the reaction to it is symbolic. That is, for the fan it’s not just about winning and losing but how this play compares to a different, famous play, whether a player has broken some sort of record in this game, possession time, etc. etc. The narcissism of small differences never applied better than it does to sports fandom. Picking over the draft, especially the top picks, in absurd detail is of a piece.
Maybe the upside to these obsessions is that, unlike winning and losing, they’re not zero sum. Fans of both teams can come away from a game feeling at least partially vindicated.
Nolan Ryan was the 295th pick of the 1965 MLB draft.
And Mike Piazza was 1390th in 1988.
And his drafting was more or less just a favor to his father, a good friend of Tommy LaSorda:
https://en.wikipedia.org/wiki/Mike_Piazza#Early_life
I don’t think that tanking is nearly an issue in the NFL as it is in the NBA. People are worried that it’s like an existential threat that effectively ruins the NBA product, and I don’t see people worried that’s the case for the NFL..
Not sure why that is, but I think some contributing factors might be, fewer games, more players as Andrew says above, outcomes in football being somewhat more random/luck?