When you look closely at your favourite sport these days, it’s difficult to ignore the influence of economics. It is visible in the way players are paid. As well as individual coaching decisions and even strategic shifts across entire leagues.
Game Theory:
This fueled in part by the rise of game theory in economics. The game theory employs mathematical models to determine optimal strategies. For instance, at where a baseball pitcher should throw or whether American Football teams should pass more frequently.
As players, coaches, and agents behave similarly to the hypothetical rational decision-makers in economic models, sport lends itself to economics and game theory.
The Economics of Public Relations Professional sports economics. If you’ve seen or read Moneyball, you’ll understand how economics is useful in putting together a team . The following is the true story of Billy Beane, the former general manager of the Oakland A’s baseball team. Beane rose to prominence for his use of economic concepts to identify undervalued players.
Baseball scouts and agents were frequently preoccupied with trivial matters such as how hard a player could hit a ball. Billy Beane used advanced statistics to identify undervalued players and play them in ways that maximised their strengths.
In basketball, Robert D. Tollison is largely responsible for the National Basketball Association’s surge in three-point shooting. The National Basketball Association is a professional basketball league based in the United States. Tollison’s research discovered that, while three-pointers are less accurate than other shots, taking more three-pointers over the course of a game and season makes sense.
Economists have been hired in some cases to solve specific problems. For example, the AFL was concerned about clubs “tanking” (intentionally losing) in order to obtain favourable draught picks (not mentioning any names, Melbourne).
As a result, the AFL commissioned Melbourne University Economics Professor Jeff Borland to develop an objective measure of club performance (based on team performance, win-loss ratios, previous finals appearances and injuries).
However, sports economics aren’t just for academics.
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