US Today has just published the 2012 version of the NCAA Football coaches salary database. And what we see is hard to believe. As they state only "six years ago 42 major college football coaches made at least $1 million. Today, 42 make at least $2 million." Coaches salaries in FBS schools are up 12% over last season and have increased an eye-whopping 70% since 2006. Alabama's Nick Saban is the highest paid at $5.5 million.
This is amazing! Institutions of higher education are paying enormous sums to coaches, who have no academic background, to run a football program, which should at best be an activity for students to spend their free time in a healthy way. Well, that ideal is long gone. I have mentioned that numerous times in the past. But why is the monster NCAA still growing that fast? College Football is popular for a long time and the growth rates in media attention and TV contracts is far from what is going on with coaches salaries.
Is something fundamentally wrong with the labor market for FBS coaches? In the past we used to see coaches move from the collegiate level to the NFL because of greater job opportunities. Obviously, this could change. Data shows that--on average--colleges do not profit financially from their sports programs. There is also some evidence that running large sport programs can influence student achievements. It is still debated whether it is fair to leave participating students without financial compensation. Looking at the current figures in terms of coaches wages we see that, for whatever reason, colleges pay enormous sums for something they might not actually benefit from. Rents seem to be generated - and as for now it seems as they are almost exclusively shared with the coaches. Most likely this a result of the non-competitive character of the BCS system.
Dienstag, 20. November 2012
Mittwoch, 17. Oktober 2012
Intertemporal Substitution
Week 6 of the 2012 NFl season is in the book and while we might have entered a new era of parity and competitive balance in Football, we also saw an (aging) icon of the game go down: Baltimore Ravens Linebacker Ray Lewis.
Lewis is probably the best Inside Linebacker in the long tradition of great players at this position in the NFL. He was the first draft pick of the relocated Baltimore Ravens and has lead the mostly great Defense ever since. He is an icon, not only for Ravens fans. He was elected to thirteen Pro Bowls and has one the Super Bowl once as a member of one of the best defensive units ever in the 2000 season. Once he is retired (a time that could come sooner than later) he will enter the Hall of Fame right off the bat.
But Lewis is also 37, playing his 17th season in the NFL. This is quite an accomplishment, as he clearly played longer than the average career at his position. And he played on a higher level. Only recently critics came to the front. They called him out for missing tackles and looking slow and (well actually he is in terms of football age) old. On Sunday Lewis injured his triceps while playing the Dallas Cowboys and on Monday he was ruled out for the season. Immediately speculations started if that might be the end of his career - only to be countered by the newest question: Would he be ready to play in a (possible) Super Bowl?
I am not convinced that the Ravens will eventually get to the title game, as they are beat up in terms of injuries and have played badly on Defense even when healthy. If they do it would have to be the (currently) high-powered Offense to carry the team. Sounds odd to say that about the Ravens, doesn't it?
If there is the slightest possibility that Lewis could return for the Super Bowl in February, the Ravens have to make a tough decision: Do they put him on injured reserve (IR) and sign somebody to replace him, or do they keep him on the roster and hope he will return for a game that is all but certain. There was a similar situation for the New York Jets, who also lost their best player on Defense, Darelle Revis, to injury and discussed his return for the Super Bowl. He was soon put on IR and all hopes for a return in the current season were put to rest. While I wish all the best to Lewis, my guess is that he will share Revis' fate.
In terms of economics the Ravens face a simple question: Is it good to save for the future? Are future returns larger than immediate returns? Is the team better off waiting for Lewis, or does it have to fill glaring holes on the roster? In this case we do not have a clear setup where we compare the utility of today's consumption to utility of consumption in t+1 because the Ravens do not know if they will still be there in t+1 if they do not consume today. So many interesting questions to think about!
Lewis is probably the best Inside Linebacker in the long tradition of great players at this position in the NFL. He was the first draft pick of the relocated Baltimore Ravens and has lead the mostly great Defense ever since. He is an icon, not only for Ravens fans. He was elected to thirteen Pro Bowls and has one the Super Bowl once as a member of one of the best defensive units ever in the 2000 season. Once he is retired (a time that could come sooner than later) he will enter the Hall of Fame right off the bat.
But Lewis is also 37, playing his 17th season in the NFL. This is quite an accomplishment, as he clearly played longer than the average career at his position. And he played on a higher level. Only recently critics came to the front. They called him out for missing tackles and looking slow and (well actually he is in terms of football age) old. On Sunday Lewis injured his triceps while playing the Dallas Cowboys and on Monday he was ruled out for the season. Immediately speculations started if that might be the end of his career - only to be countered by the newest question: Would he be ready to play in a (possible) Super Bowl?
I am not convinced that the Ravens will eventually get to the title game, as they are beat up in terms of injuries and have played badly on Defense even when healthy. If they do it would have to be the (currently) high-powered Offense to carry the team. Sounds odd to say that about the Ravens, doesn't it?
If there is the slightest possibility that Lewis could return for the Super Bowl in February, the Ravens have to make a tough decision: Do they put him on injured reserve (IR) and sign somebody to replace him, or do they keep him on the roster and hope he will return for a game that is all but certain. There was a similar situation for the New York Jets, who also lost their best player on Defense, Darelle Revis, to injury and discussed his return for the Super Bowl. He was soon put on IR and all hopes for a return in the current season were put to rest. While I wish all the best to Lewis, my guess is that he will share Revis' fate.
In terms of economics the Ravens face a simple question: Is it good to save for the future? Are future returns larger than immediate returns? Is the team better off waiting for Lewis, or does it have to fill glaring holes on the roster? In this case we do not have a clear setup where we compare the utility of today's consumption to utility of consumption in t+1 because the Ravens do not know if they will still be there in t+1 if they do not consume today. So many interesting questions to think about!
Mittwoch, 26. September 2012
Back to the replacements
While my last entry in this blog was dealing with the possible repercussions of the current referee situation in the NFL, reality has once again overtaken me and it is now even worse than I had expected. While during the last weeks the replacement refs made many critical and obviously wrong calls, it has reached a new level with the result of Monday Night Football.
On Monday the Green Bay Packers played at Seattle to match the Seahawks. Most of the game was a brilliant defensive effort (sadly nobody is talking about that) from Seattle and not much offense took place. And it was a "usual" replacements game, as there were numerous dubious pass interference calls, some critical penalties and a general feeling that they were not 100% in control of what was going on all the time.
But then there was th final play. And it was a big one, as Seattle was back 5 points and they needed a hail mary pass to win the game with the final play. So Seattle QB Wilson, after avoiding a sack, threw it up for grabs into the end zone in the general area where Golden Tate was waiting for it. He was surrounded by at least four Packers and Packers DB M. Jennings was in perfect position to defend the pass. Instead of doing what defenders are tought to do in such a situation, i.e. knocking the ball down, he tried to catch it. And he DID catch it and all replay angles showed he caught it first and although Tate might have had simultaneous possession of the ball while going to the ground for a split second, it was Jennings who had the ball in the end.
By now everybody knows the end of the story. The catch was awarded to Tate (even after review) and the NFL has admitted the mistake. However, they are only admitting that Tate was actually pushing off before the "catch" (enough to overturn it) and still call it a simultaneous catch which, by rule, should go to the offense. Everybody who saw what happened knows that this is wrong. There was a push off, yes, but Tate never caught the ball. It was a clear mistake that I do not think regular NFL refs would have made.
The way the NFL is handling the situation is definitely deciding games. We saw that on Monday. The integrity of the game is in danger. Some Packers have come forward and argued that the NFL was "more about money than the integrity of the game". Well, that's news! The NFL is the best sports business in the world. Of course, it is all about money. If it was just about competing in the game of football it would not be a billion dollar industry. Interesting, though, that this criticism comes from the only NFL team which is publicly owned (Packers). So there is no owner involved who wants his profits maximized rather than the success of his team on the field of play.
I agree. The integrity of the game is in danger. But I would go a step further: the only fans who might be happy right now live in the city of Seattle. If fans see that the current situation goes on and more games are decided by wrong officiating, they will turn away and the NFL as a whole product could suffer.
The NFL could have changed the call or set a rematch. They decided to stick to the result and come up with bad excuses. Fine, but please, for the sake of the game and the league, pay the regular refs and bring them back!
On Monday the Green Bay Packers played at Seattle to match the Seahawks. Most of the game was a brilliant defensive effort (sadly nobody is talking about that) from Seattle and not much offense took place. And it was a "usual" replacements game, as there were numerous dubious pass interference calls, some critical penalties and a general feeling that they were not 100% in control of what was going on all the time.
But then there was th final play. And it was a big one, as Seattle was back 5 points and they needed a hail mary pass to win the game with the final play. So Seattle QB Wilson, after avoiding a sack, threw it up for grabs into the end zone in the general area where Golden Tate was waiting for it. He was surrounded by at least four Packers and Packers DB M. Jennings was in perfect position to defend the pass. Instead of doing what defenders are tought to do in such a situation, i.e. knocking the ball down, he tried to catch it. And he DID catch it and all replay angles showed he caught it first and although Tate might have had simultaneous possession of the ball while going to the ground for a split second, it was Jennings who had the ball in the end.
By now everybody knows the end of the story. The catch was awarded to Tate (even after review) and the NFL has admitted the mistake. However, they are only admitting that Tate was actually pushing off before the "catch" (enough to overturn it) and still call it a simultaneous catch which, by rule, should go to the offense. Everybody who saw what happened knows that this is wrong. There was a push off, yes, but Tate never caught the ball. It was a clear mistake that I do not think regular NFL refs would have made.
The way the NFL is handling the situation is definitely deciding games. We saw that on Monday. The integrity of the game is in danger. Some Packers have come forward and argued that the NFL was "more about money than the integrity of the game". Well, that's news! The NFL is the best sports business in the world. Of course, it is all about money. If it was just about competing in the game of football it would not be a billion dollar industry. Interesting, though, that this criticism comes from the only NFL team which is publicly owned (Packers). So there is no owner involved who wants his profits maximized rather than the success of his team on the field of play.
I agree. The integrity of the game is in danger. But I would go a step further: the only fans who might be happy right now live in the city of Seattle. If fans see that the current situation goes on and more games are decided by wrong officiating, they will turn away and the NFL as a whole product could suffer.
The NFL could have changed the call or set a rematch. They decided to stick to the result and come up with bad excuses. Fine, but please, for the sake of the game and the league, pay the regular refs and bring them back!
Freitag, 21. September 2012
Their A game!
One of this year's big stories in sports is the season the Oakland A's are having. They are currently ranked 2nd in the American League West and tied for first in the Wild Card race with the Baltimore Orioles. While they are technically not yet in the playoffs, they are in a good spot and there is no indication that they will fall off.
But is is the way they reached their current spot that is so amazing: The A's are playing with rookie starters (5 at one point), they have really no major names on their roster and their lineup does not scare anyone in the American League. AND they are doing it with Major League's second lowest payroll at $ 55,372,500. This is substantially lower than what the Texans spend ($ 120,510,974), who they trail by just 4 games in the AL West. The A's are ranked 5th in the majors in pitching with a team ERA of 3.50. They rank 9th in terms of home runs with 172. So they have it all: pitching and power. And they are doing it while they should actually be rebuilding.
The A's manager Bob Melvin seems to be doing a lot right. But the whole organization from top to bottom does a perfect job. In sport economics the final word on the causal relationship between team payrolls and success has not yet been said. The A's once again show that maybe it is not money you need to win.
Donnerstag, 20. September 2012
NFL replacement refs - dangerous for the game?
We are well into the current NFL season, and apart from the usual media buzz, injury news and endless discussions about the performances of rookies Quarterbacks, there is one thing standing out: the usual NFL referees are locked out and replacement crews are refereeing the games. These replacement crews were installed in preseason and mostly consist of non-BCS conference referees from the NCAA. While this might not sound too spectacular, it might actually be a big deal for the league.
It is still a debate how good a job these referees are doing. The media are highly critical, while the broadcasting TV networks are still hesitant to be overly critical regarding the product they offer. But the first two weeks of regular season games showed that the replacement officials got at least a few major calls wrong, mixed up some penalties and generally made more mistakes than the usual referees.
The entry salary for an NFL official is $78,000. While this might not sound bad for a season of 16 plus postseason games, their salary is significantly below those of the other major sports leagues. The talks between the officials and the NFL have basically been suspended. Both sides could not come even close to an agreement so far.
So is it really about a few blown calls or some misplaced balls on the field? I guess not, because now that two weeks of regular season play are in the books something else - even more problematic - has emerged. Numerous personal fouls were not called on the field by the replacements and the atmosphere in numerous games was more than just competitive. So my guess is that while they try to avoid any mistakes, the replacements referees miss many overly rough plays. The NFL was quick to fine the guilty players (ask Golden Tate of the Seattle Seahawks) , but on-field calls would certainly be better to stop the extracurricular chippiness and unnecessary roughness between players. Some media observes have even gone as far as arguing that the replacement refs might actually be the reason why the game is more violent and dangerous at the moment.
One of the big objectives of NFL boss commission Roger Goodell was to make the NFL saver and reduce the risk of severe (head) injuries. Rightfully so, with the high number of potential lawsuits lingering. But by being overly strict in the negotiations with the referees he might have reached the contrary. Maybe it would just be better to give the referees what they want instead of having to deal with the consequences of an increase in the number of injuries. And it is not just about the general perception of the NFL as a "save" league, but I do not think that fans want to pay for watching teams that are substantially decimated by injuries.
It is still a debate how good a job these referees are doing. The media are highly critical, while the broadcasting TV networks are still hesitant to be overly critical regarding the product they offer. But the first two weeks of regular season games showed that the replacement officials got at least a few major calls wrong, mixed up some penalties and generally made more mistakes than the usual referees.
The entry salary for an NFL official is $78,000. While this might not sound bad for a season of 16 plus postseason games, their salary is significantly below those of the other major sports leagues. The talks between the officials and the NFL have basically been suspended. Both sides could not come even close to an agreement so far.
So is it really about a few blown calls or some misplaced balls on the field? I guess not, because now that two weeks of regular season play are in the books something else - even more problematic - has emerged. Numerous personal fouls were not called on the field by the replacements and the atmosphere in numerous games was more than just competitive. So my guess is that while they try to avoid any mistakes, the replacements referees miss many overly rough plays. The NFL was quick to fine the guilty players (ask Golden Tate of the Seattle Seahawks) , but on-field calls would certainly be better to stop the extracurricular chippiness and unnecessary roughness between players. Some media observes have even gone as far as arguing that the replacement refs might actually be the reason why the game is more violent and dangerous at the moment.
One of the big objectives of NFL boss commission Roger Goodell was to make the NFL saver and reduce the risk of severe (head) injuries. Rightfully so, with the high number of potential lawsuits lingering. But by being overly strict in the negotiations with the referees he might have reached the contrary. Maybe it would just be better to give the referees what they want instead of having to deal with the consequences of an increase in the number of injuries. And it is not just about the general perception of the NFL as a "save" league, but I do not think that fans want to pay for watching teams that are substantially decimated by injuries.
Montag, 16. Juli 2012
The NFL's richest man.
This weekend has produced the highest NFL contract since the beginnings of professional football. Drew Brees, the man who has just broken Dan Marino's single season passing yardage record, was handed his 5-years $ 100 million contract by the New Orleans Saints.
While this move is not only record setting in terms of per year salary, it is also a significant move for the New Orleans franchise. The organization which was hit hard by the harsh penalties following the still evolving "bounty-gate scandal" had the first positive news since the end of last season. They signed the most productive and successful Quarterback in franchise history for a long-term deal and sent a message to the whole league that they want to be contenders in the future.
In terms of economics it is amazing to give a 32 year old QB such a huge contract, including $ 60 million of guaranteed money. Remember: Before coming to the Saints Brees had a significant, career-threatening shoulder injury, and he is not exactly young either. When the full 5 years of this contract are played out, he will be around 37, which is very old for an NFL QB. My guess is that this contract either makes the Saints look extremely smart over the next few seasons, or it will pretty much end the feel-good-story in the Big Easy.
Anyway: i think it is just appropriate to congratulate Brees and I wish him all the best for the next five years at least.
While this move is not only record setting in terms of per year salary, it is also a significant move for the New Orleans franchise. The organization which was hit hard by the harsh penalties following the still evolving "bounty-gate scandal" had the first positive news since the end of last season. They signed the most productive and successful Quarterback in franchise history for a long-term deal and sent a message to the whole league that they want to be contenders in the future.
In terms of economics it is amazing to give a 32 year old QB such a huge contract, including $ 60 million of guaranteed money. Remember: Before coming to the Saints Brees had a significant, career-threatening shoulder injury, and he is not exactly young either. When the full 5 years of this contract are played out, he will be around 37, which is very old for an NFL QB. My guess is that this contract either makes the Saints look extremely smart over the next few seasons, or it will pretty much end the feel-good-story in the Big Easy.
Anyway: i think it is just appropriate to congratulate Brees and I wish him all the best for the next five years at least.
Mittwoch, 11. Juli 2012
Here we go again...
Another year at the Tour de France and we have yet another doping scandal. Yesterday we had the first day of rest of the 99th edition of the Grande Boucle. But instead of resting the peloton experienced a major shakeup. Cofidis rider Rémy Di Gregorio was arrested by the French police in the aftermath of a team hotel raid. He was later suspended by his team and is the first doping casualty of this year's tour.
But it is not the only doping related story these days. Lance Armstrong is fighting doping allegations brought forward by the USADA. Currently highly successful team SKY, the team featuring the current tour leader Bradley Wiggins, is confronted with doubt and suspicion, as it was questioned by the media if the remarkable time trial performance on Monday was possible without performance enhancing drugs.
After a relatively quiet Tour in 2011 we are probably back to the days when doping news were daily business during the 3 weeks of the Tour. Up to this day no positive test results were published, but Di Grigorio's case does not look good. Maybe he is indeed the "single case" his team wants him to look like - or not guilty at all. Maybe he is part of a team Festina-like structure of organized doping and just a scapegoat. We will have to wait and see what the next few weeks will bring along...
Doping is a highly interesting topic in sports economics. A recent paper by Coupé and Gergaud (2012) presents a recent attempt to analyze data from professional cycling in order to establish a link between doping related indicators and riders' performance.
But it is not the only doping related story these days. Lance Armstrong is fighting doping allegations brought forward by the USADA. Currently highly successful team SKY, the team featuring the current tour leader Bradley Wiggins, is confronted with doubt and suspicion, as it was questioned by the media if the remarkable time trial performance on Monday was possible without performance enhancing drugs.
After a relatively quiet Tour in 2011 we are probably back to the days when doping news were daily business during the 3 weeks of the Tour. Up to this day no positive test results were published, but Di Grigorio's case does not look good. Maybe he is indeed the "single case" his team wants him to look like - or not guilty at all. Maybe he is part of a team Festina-like structure of organized doping and just a scapegoat. We will have to wait and see what the next few weeks will bring along...
Doping is a highly interesting topic in sports economics. A recent paper by Coupé and Gergaud (2012) presents a recent attempt to analyze data from professional cycling in order to establish a link between doping related indicators and riders' performance.
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