Ashes Combatants Understand Gains from International Trade in Coaches (AFR Piece)


Another opinion piece of mine appeared in today’s edition of the Australian Financial Review (Thursday 11 June), titled: “Free Trade in Coaches Gives All Teams an Edge” (link gated), on p.51. Alternatively, if you don’t have the hard copy, feel free to e-mail me a request.

It draws analogies between generalities of the virtues of free-trade (internationally), and the specific labour market for foreign coaches of national sports teams.

This is kinda topical in Australian media circles at the moment because of Australian Trevor Bayliss recently being appointed coach of England ahead of the Ashes (starting in 4 weeks time). Happy reading!

Home Advantage Omen for Ashes Whitewash


[Archived from: The Sports Economist, 2 January 2014]

With cricket’s latest ‘Ashes‘ series having been decided more than a fortnight ago, much of the remaining interest in the final Test, just underway, centres purely on whether Australia can complete a 5-0 Ashes whitewash for only the third time in history (following 1920/21 and 2006/07). Most ‘key performance indicators’ for Sydney are pointing in that direction – the newly-rediscovered ferocity of the Australian pace attack, not to mention the unexpected feebleness of England’s batting top-order (and middle-order, for that matter). England have also selected three debutants.

Moreover, there is an additional factor that, given recent history, points fairly and squarely in Australia’s favour – merely that they are the home side. The calendar year of 2013 was a stellar one for home teams in Tests. Specifically, of the 44 Tests played last year, a remarkable 30 were won by the home team, 10 were drawn and only 3 won by the away team (Pakistan looks likely to make that 31 against Sri Lanka in the Test that started on New Year’s Eve).

The surprising element of this occurrence, according to some pundits, was that it came after a period, from 2010-2012, in which away teams performed quite admirably against the tide of home-ground advantage. At least on the basis of raw numbers – in these years, a combined 124 Tests resulted in 48 home wins, with the number away wins almost at parity (43). This apparent ‘trend’ towards away teams did not go unnoticed by sports journalists and other non-academic writers. For example, Gideon Haigh remarked to this effect (“The quiet revolution: home ground advantage begins to fade away”, The Australian, 20/12/2012).

However, as economists know all too well, looking at just the raw figures is too parsimonious an analysis for making claims that the nature of home-ground advantage – a phenomenon so well researched, understood and entrenched in sporting culture – has diminished so fundamentally and suddenly. What needs to be understood about the sample of Tests in those years were that they were correlated with factors that skew the chances of victory in favour of the home team to begin with, most obviously on the basis of relative strength of both teams.

For example, easily the best team of 2012, South Africa, played 10 Tests that year. All but one of them were played away from home, with an unbeaten record (4 wins, 5 draws) befitting a World number one. This is a nice example of what in economics (and some other scientific disciplines) is called a ‘selection bias’ – such biases have to be accounted for, since it is not difficult to imagine how the figures would have more-highly favoured home teams at an aggregate level if the Proteas had instead been scheduled to play 9 Tests at home. Another example (this time for 2011) is that minnows Bangladesh and Zimbabwe played a combined total of 8 Tests, 7 of which were on home soil, again skewing the overall record in favour of away teams. With such a small sample of teams and Tests, these selection biases are important and should not be ignored.

Likewise, the stunning reversal back towards home teams in 2013 has to be taken with caution – (the again rampant) South Africa played 7 of its 9 Tests at home, winning 6 and drawing the other. Second-ranked India also played the majority (6 of 8) of its Tests at home, completing a perfect record, not to mention third-ranked England’s impressive Northern summer record (5 wins, 2 draws), prior to their almost inexplicable slide in the current series.

Most Australian cricket supporters will  hope that the aberration of 2013 does not continue past this week – their next series is away to South Africa. Otherwise, that tour could prove to be a sobering experience following the current euphoria. Nevertheless, the influence of home-ground advantage in Test cricket does not appear to be under any immediate threat. To this end, if one was the betting type, I would not be shy in punting on a home victory at the SCG.

Media Misses Point on Cricket’s Decision Review System


[Archived from: The Conversation, 15 July 2013]

The first Ashes Test was indeed a veritable thriller. England edged Australia by a mere 14 runs, after an absorbing four-and-a-half days of action to go one-up in the best-of-five series. For those not well versed on the sport, only a dozen or so of more than 2,000 Tests dating back to 1877 have been decided by fewer runs.

Partly because of the closeness of the match, much of the media focus has centred on decision outcomes arising from the Decision Review System (DRS). This system, which allows up to two incorrect challenges per innings, is in economic terms a resource like any other – a scarce one, and one to be used, lest it be lost.

Opening with a disclaimer, I have absolutely no sympathy for my team here. No Australian cricket fans were complaining back in the pre-DRS era in 2008 when the Andrew Symonds incident in Sydney arguably turned the entire series against India in Australia’s favour. I could even excuse Doug Bollinger for his infamous dummy spit in Adelaide a couple of summers later against the West Indies when the system was still in its infancy, but by now there is no longer any excuse for such irrationality.

What is not in dispute is that the DRS has significantly reduced the incidents of incorrect umpiring decisions being allowed to effectively stand, relative to the previous status quo. This is also true in tennis, yet the consensus is that it works perfectly well in that sport. This helps tell the economist in me that there is very little, if anything at all, wrong with the system itself in cricket. But try telling that to various print and broadcast journalists.

Many local scribes over the weekend into today have sadly succumbed to the temptation to pander to the masses of their readership. Since Australian fans want to have our spleen vented in one united voice right now (among other ways) by reading what we want to hear – that “we woz robbed” – sports writers have a strong incentive to serve up precisely that, even if it misses the entire point.

As an economist, of ultimate policy-related importance is that what the DRS did was to re-assign some (albeit small) proportion of decision-making power from the umpires to the players themselves. But what is being ignored in the DRS discourse is the commensurate responsibility that comes with that power.

Sure, Aleem Dar’s third-day call on Stuart Broad was indeed a howler, and that wasn’t the only injustice served up by the men in white during this Test either. But why is it that no-one seems to be willing to give Australian captain Michael Clarke and his men the unconditional lambasting they deserve for willfully squandering their unsuccessful challenges like a bunch of drunken sailors on tour?

An argument here might be to say that (former Australian wicket-keeper Adam Gilchrist’s views on walking aside) professional athletes cannot be trusted for complete honesty anyway. So why bother holding them to account like we have always done to the umpires?

However, this argument is weak at best. In fact, if I were Stuart Broad, I too would have defiantly stood my ground. What’s more, rather than looking sheepish about it, I would have backed it up by giving the Australian players a right old bollocking – or perhaps sledging – telling them (in laymen’s terms) that if they were not so systematically and profligately quick on the trigger with their challenges, I’d be back in the pavilion by now…so suck it up, laddies!

Even more worrying was that the harsh lessons from the third innings of the match were not heeded in the final innings, when Australia once again exhausted their challenges early on (though they had already benefited once from one correct challenge). Imagine if Brad Haddin had not actually nicked the ball, yet were incorrectly shown the index finger.

Economics, particularly on the micro side, is about decision-making. I am yet to meet a cricket-loving microeconomist who thinks the DRS is anything but a solid system with an appropriate treatment given to incentives and strategy.

It is just a pity that the Australian cricketers have not yet woken up to their responsibility of mastering the art of rationality around it, and that commentators and writers have not yet learned to correctly apportion the fair share of the blame on the players for the so-called injustices that can still arise under the system.

‘Old Urn’ Itself Could Alter Aussie Ashes Tactics


[Archived from: The Sports Economist, 10 July 2013]

The oldest prize in Test cricket is once again up for grabs. Commencing earlier today, Australia is taking on England away from its own backyard in an attempt to regain the Ashes. Michael Clarke’s men have shown transparently that this one is the series they have the greatest desire to win, despite the old urn’s grossly underwhelming aesthetic stature.

Following its creation as the spoils of victory in series between these combatants in 1882 (though curiously never designated as such formally), its place in the sport as a bilateral trophy (one that can be won only by either of two teams) was unique for almost 80 years.

This changed only during the remarkable 1960/61 West Indies tour in Australia, which was capped with the minting of the Frank Worrell Trophy, to be contested thereafter between those teams. There has more recently been a real proliferation of these trophies, especially since the mid-1990s.

Currently, with 10 Test playing nations involved in World cricket, there are consequently 45 bilateral sets of opponents, and a total of 11 different bilateral trophies (effective since 2008) are now actively played for periodically, with Australia being the ‘worst offenders’, playing for 6 such trophies out of its 9 Test rivals.

Cricket fans – please feel free to disagree, but one’s personal view is that with the Ashes an obvious exception (given its history), many of these other bilateral trophies are surplus to one’s interest above and beyond the simple significance of the Test series and its ultimate result, and often play a role of little more than a shameless gimmick, and a diminution of the actual cricket.

Nonetheless, in any individual Test series, the simple tactical objective is generally to win the series, and if that becomes mathematically impossible or even improbable, a series draw is still better than a loss.

A complicating factor in cricket, however, is that there is no universal consensus – the ICC ranking system aside – on the value of a draw relative to a loss, unlike other sports where league points make this explicit (one-half in many sports, one-third in modern soccer). The existence of a trophy, assuming that ‘holding’ it really matters to players and fans, muddies the tactical waters, as the holder has to be beaten for the ‘silverware’ to change hands.

There is relevance in this setting of interest to microeconomists through incentives and strategy. Sporting contests have much potential to tell us economists more than a thing or two about the way firms behave in duopolistic industries where the competitors are not equally resourced.

Assuming there is some value to holding the trophy, potential follows for this value to skew attacking and defensive tactical decisions of both captains, comparative to the identical series scenario where there is no trophy on the line.

This upcoming series can be used to illustrate a textbook case of how a bilateral trophy being at stake may just alter team behaviour at the margin. However unlikely you think it, suppose the series is level at 1-1 after four Tests, and that late on day five of the fifth test, the final and deciding game is on a knife’s edge (and that a draw is still a comparable possibility).

Since 1-1 is not good enough for Australia to return home with the prize (England currently holds the Ashes), it is easy to envisage how Michael Clarke would throw caution to the wind to give his XI every possible chance of winning the decider, not to mention what Alistair Cook’s ‘game theoretic’ tactical response might be.

In the counterfactual that there exist no Ashes for him to regain, rather it’s purely the series outcome that matters, one might imagine how he may turn defensive to suffice for a draw and (arguably) claim a moral victory in levelling an away series against a significantly more favoured team. The inclination for him to do this might be accentuated if his captaincy and/or personal form were under scrutiny during the series, with equal honours perversely providing him some measure of vindication.

Even if you summarily reject any possibility that Clarke would ever sway toward that tactical inclination, you might be willing to accept how Zimbabwean skipper Brendan Taylor would analogously almost certainly opt for any stalemate within reach at the death of an away series to their neighbours – the World top-ranked South Africans.

At any rate, I suspect that fans of Australian cricket will have a wide range of views about how they will feel about a drawn series. Many will consider it equivalent to a series loss, since the Ashes are not regained either way. Others like me, with the recent 4-0 whitewash in India still fresh in the mind, will still take some matter of pride in averting a third successive series loss against the old enemy.

Another ‘ABC News Breakfast’ Newspaper Segment


I was invited back on ABC News Breakfast again with their A-Team of Michael Rowland and Virginia Trioli talking about a few stories from today’s newspapers (details below).


Liam Lenten – appearance on ABC1 News Breakfast for the fourth occasion, discussing a mixed bag of the day’s newspaper stories, including international climate deals, political unrest in Russia and cricket.

Another ‘ABC News Breakfast’ Newspaper Segment


I appeared again on (today’s edition of) ABC News Breakfast with Michael Rowland and Virginia Trioli discussing a handful of notable newspaper stories (details below).


Liam Lenten – third time on ABC1 News Breakfast, discussing the Mining Tax, Surpluses in the University Sector and two Cricket-Related Stories.

Increasing Rationality in the Referral System?


[Archived from: The Sports Economist, 30 March 2011]

Further to Brad’s earlier post, the 2011 ICC Cricket World Cup in the subcontinent is nearing its zenith. Today’s semi-final between India and Pakistan will be a highlight – nobody needs reminding about the history between these two bitter rivals. Whoever wins will meet Sri Lanka, who accounted for New Zealand in the other semi last night, ensuring that the winner will be one of the tournament co-hosts.

Other highlights have included Ireland’s upset win over England, the stunning 338-338 tie between India and England, the end of three-time reigning champion Australia’s 34-match World Cup unbeaten streak, and New Zealand’s unexpected quarter-final rout of the highly-fancied South Africa.

Having watched a limited amount of the action, only one facet has stood out for me as an economist.  I suspect that cricketers have become increasingly (albeit gradually) rational in their use of challenges since the sport’s first trial of the referral system in 2008.

There are a few such instances, but the one that demonstrated it most was that of Australian (now former) captain Ricky Ponting, who in the Group A game against Sri Lanka in Colombo, authorised two (ultimately unsuccessful) challenges in the over before the players were forced off the pitch due to rain (it proved to be the final phase of play, as the match was ultimately abandoned).

With the rain already falling, one suspects that we can apportion some of his decision to the fact that, had the challenges been upheld (and taking the imminent loss of playing time into account), Australia’s Duckworth-Lewis revised target in the second innings (had the rain stopped eventually and Australia batted with reduced overs) would have been amended downwards, purely on the basis of Sri Lanka having lost an extra wicket.  [Disclaimer: I am going to give Ponting the benefit of the doubt that he at least has half-a-brain.]

A similar phenomenon seems to have occurred in tennis, since the first time the challenge system was in operation in the 2007 Australian Open (players had three unsuccessful challenges per set initially), where everybody seemed most reticent to use their challenges.  Now, they appear to use them liberally, recklessly so when they are close to losing the set, viewing them (correctly) as a resource that is essentially sunk if the set ends and the number of unsuccessful challenges re-set.

I am interested to canvass the views of TSE readers on this one.  Furthermore, it is surprising that no-one has yet put this hypothesis to the test formally.  Any thoughts?

Indian Premier League Spend/thrift


[Archived from: The Sports Economist, 10 January 2011]

The 2011 Indian Premier League cricketer auction took place on the weekend. This event is a fascinating economic exercise on so many levels, and not just because of the auction framework, but also because it gives us a view into the future, in which pro-sport salaries on the subcontinent may begin to rival those in the major leagues (though this may still be some way off yet). Nevertheless, four players (all Indian), topped the US$2 million-mark, with the wonderfully-named Kolkota Knight Riders outlaying US$2.4 million for the enigmatic Gautam Gambhir.  For a quick summary of the auction outcomes, see:

The inaugural IPL auction in 2008 was such a unique event insofar that all the World’s best cricketing talent was ‘up for grabs’ (except five Indian ‘icon’ players) simultaneously, with very little information about past player performance in the still-fledgling (at the time) Twenty20 form of the game – thus the bidders were relying a lot on information from longer formats of the game. The auction inspired my colleagues Wayne Geerling and László Kónya and I to apply hedonic price models to the 2008 auction data – see this Working Paper.

This time around, the auction was not of quite as much intuitive appeal economically – bidders now have a much better idea of how players perform in the short-form of the sport, while there were options for the franchises to retain players previously on their lists, creating labour-market rigidities not present in 2008.

I am still digesting the big movers (winners and losers), but it seems like a sensible take on proceedings to suggest: (i) the obvious – that the cap, and subsequently wages, are significantly higher overall; (ii) that the prices are more predictable this time around; and (iii) that the ‘superstar’ effects typically observed in pro-sports are even more profound this time.

Much has already been written on not only player values and associated labour-market issues in cricket, but also on the profound effect that Twenty20 and the IPL is having on the business model of cricket (which has really only had one revolutionary change since the first ever Test Match in 1877). What I would like to see economists do is apply some auction theory to this setting – to the best of one’s knowledge; this is yet to be done by anybody.

La Trobe Academics v Professional Staff Cricket Match


I love playing cricket! I qualify that statement – I love playing cricket twice a year…no more. As Danny Glover said famously (and repeatedly) to Mel Gibson: “…I’m getting too old for this shit”.

Yesterday, I played in the time-honoured traditional Academics v Professional Staff Cricket Match at La Trobe (known informally as the ‘Dons v Hawks’). The match goes back to 1985, and I first played in this fixture in 1998, playing almost every year since (we managed to revive it after a few years of recent inactivity). It used to be a 35-over-a-side match on Sunday afternoon; but as times have changed, with increasing difficulty of securing sufficient participation, we shortened it to a Twenty20 match on a mid-week evening straight after work (I’m on the 4-person organising committee). That worked a treat!

The event was a bona fide success – we even had the Vice-Chancellor, Professor Paul Johnson come along to present the Credit Union Trophy to the winners. Full match report here (see pp.9-10), but in short, but we (Dons) made it three in a row (overall historical head-to-head about even), managing to bowl the Admin Staff out for a paltry 82 in a low-scoring affair (the outfield was extremely heavy), with the successful reply of 4/84 coming in comfortable time, albeit conservatively – the only time I actually like seeing Hawks lose! I was pleased with my return of one catch, 2/11 and 7* (I was there at the finish).

The body does not get much time to recover (I did say two matches per year). Next Wednesday, in a very different match, our School of Economics and Finance takes on Monash University’s Centre of Policy Studies (CoPS) in a fixture dating back to my first year at LTU of 1997. In almost every single year from 1997-2009, I was responsible for organising the La Trobe end of the bargain. When playing away, this involved getting a team together (including ring-ins from other Schools for a full team), as well as organising practice sessions, playing gear and a match ball. When playing at home, it involved the additional responsibilities of hiring the ground (Lower Playing Fields) and arranging light refreshments for after the game in the Donald Whitehead Building Level 4 Tea Room. This event is an important annual social event, and had the benefit of academic interaction with some of our contemporaries at Monash.

UPDATE: We lost the match against CoPS, as usual (those guys train for weeks before-hand). Gutted! As seen below, I absolutely cruised through to 23 before being out LBW, despite clearly edging the ball first. Can we get DRS for social matches as well?