The ‘REAL’ Winners of the Asian Cup

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The green-and-gold heaven that was the AFC Asian Cup Final (or as I referred to it, Confederations Cup qualifier) was undoubtedly a watershed moment for the World game in Australia, one of the few remaining markets where football is not (yet, at least) the number one sport. The 2-1 (ET) match was indeed a thriller, and I’ll take it; even though a penalty shoot-out would have better reinforced our case for penalties before extra-time.

However, this post is intended to make a very different point – one about the more general matter of cost-benefit analysis of the whole event itself. Us sports economists of the academic variety are generally united in the view that typically, use of public funds to subsidise bids for a major sports event, as well as to run the event itself (if the bid is successful), is inherently profligate. Refer to my 2009 (Australian Financial Review) characterisation of a case in point – the colossal waste of $46.5 million of Federal government funds on the FFA’s 2018/2022 FIFA World Cup bid. In that case, like so many others, the ‘boosters’ of the event tried to convince us that the economic benefits would be huge (they are always much smaller), while the costs (and timelines) invariably blow out. This is a lesson that is still most freshly (and bitterly) experienced by ordinary Brazilian citizens.

This case had a few differences to the usual story, however. Other potential suitors to the AFC for hosting rights dropped out of the race during 2010, leaving Australia as the sole bidder – the formal announcement on 5 January 2011 came as no surprise to anybody (and, curiously in hindsight, received scant media coverage). The next day on ABC News Breakfast (skip to 6:05), I was actually quite sanguine about the economics of hosting it.

The reason, as I saw it then, was as follows: unlike the World Cup, not having to compete with other ‘buyers’ for the event, Australia was effectively bestowed as hosts for a low ‘price’ – without having to promise so much (comparative to other such cases) in the way of upgraded facilities and the like. It also meant that the AFC as the ‘seller’ was forced to accept that lower price. This did not stop the Organising Committee from trying to provoke various state governments to bid against each other to host the matches themselves. It is no coincidence that Perth and Adelaide were excluded from the venue list – the WA and SA governments declining to pay – despite each being much bigger media markets than both Canberra and Newcastle combined.

So, I surmise that the REAL winners of the Asian Cup were Australian taxpayers, who in a rare example, paid a relatively modest amount for the hosting rights for this event!!! Furthermore, given that the hosts prevailed in a thrilling Final, the sporting gods delivered them even more bang for their tax dollar buck than they might have expected.

A final word of caution: if in the aftermath of this success, you are inclined to believe that Australia should once again throw its hat in the ring for World Cup hosting rights in 2026 or beyond, hold your horses. The last decade has taught us that Australia should stick to the smaller-scale international football events that it can host well and economically. Other examples would include the Women’s World Cup, Youth (U/20) World Cup or Club World Cup. Let us allow other countries – the largest national and continental media markets (or even those with massive reserves of oil) – to fight with each other for the ‘privilege’ of grossly overpaying for the World Cup.

Aussie Tennis Stars Statistically Fail to Fire at Home

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My first newspaper piece for 2015 appeared in the Australian Financial Review (today, Friday 9 January), called: “Home-court advantage fading away in Australia”. It did not appear on-line, so e-mail me a request for a copy if you’re a tennis fan (even if you’re not) who wishes to read it. Alternatively, it’s on p.35 of the hard copy for those with access.

It builds on work I’ve been doing with Dr James Reade (University of Reading). The basic thrust is that home advantage on the ATP Tour was insignificant for Australian (male) tennis players over our 2003-2013 sample period, unlike most other major tennis-playing nations. These blokes had better start pulling their collective finger out!

UPDATE: They did…a bit!

Lead Article of Volume in ‘Journal of Sports Economics’

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There was a nice surprise yesterday, when I discovered that my latest published article – in the Journal of Sports Economics – has been assigned as the lead article of this year’s volume (16). Signals seem to be mixed on whether this actually means anything in terms of esteem or quality judgements, but a well-known empirical regularity is that lead articles do tend to get more citations other things being equal (see, for example, Coupé, Ginsburgh and Noury, 2010, in Oxford Economic Papers), so here’s hoping.

The article itself adjusts win percentages of NFL teams to account for strength of schedule, prior to calculating standard measures of competitive balance. I find that the adjustment makes the NFL (already considered the epitome of competitive balance) look even more balanced. For the record, the details are as follows:

Lenten, L. J. A. (2015), “Measurement of Competitive Balance in Conference and Divisional Tournament Design”, Journal of Sports Economics, 16(1), 3-25.

You can view the abstract here, and e-mail me if you would like a copy.

Hawthorn’s Case for All-time AFL Premiership Supremacy

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I thought I’d blog a brief post about Hawthorn’s 2014 AFL Grand Final triumph because…well, I can.

In an orgy of brown and gold hubris, I chose to celebrate the occasion by gloating shamelessly in today’s Australian Financial Review (Tuesday 30 September), in the article: “Adjusting the Count Makes the Hawks AFL Winners” (gated, on p.55 of print copy).

The thrust suggests that all things considered for ‘opportunity’ (both seasons in AFL and number of teams in each season), Hawthorn now goes statistically to the top of the AFL all-time premiership tree, despite being equal-fourth on raw numbers.

I also had a short interview on Mornings with Geoff Hutchison on ABC Radio (Perth), discussing other findings arising from this adjustment (with an emphasis on the two WA teams).

E-mail me a request if you are interested in either of these files.

Perhaps the final word on AFL season 2014 should belong to Titus O’Riely: “The good news is that finally, the drought is over for those long suffering Hawks supporters. How they have waited. It’s not every year Hawthorn wins a Premiership, but it really feels like it.”

Tracking Career Success of Past Students

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I’ve been updating my CV recently (…as one does periodically), and advice from a colleague prompted me to track the recent career trajectories of some of my past students – that is, those for whom I supervised a thesis (Honours or PhD). Admittedly, I had not been in contact with some of them for quite some time, and so it was lovely renewing acquaintances.

Anyway, I was surprised just how well some of them had done (shouldn’t have been, as they were all good). In fact, some of these Honours students have since progressed to a range of positions with many notable organisations, such as the Australian Competition and Consumer Commission (ACCC); BIS Shrapnel; National Australia Bank (NAB); and Victorian Department of Education and Early Childhood Development. Furthermore, a PhD student I successfully co-supervised now has an academic position in his native Saudi Arabia (Arab Open University). One of the best aspects of academia is the realisation of the role you play in the development of students. I’m genuinely rapt to see they’re all doing so well in their respective fields.

Supervision has provided other benefits – one of these Honours theses (David Rulli) resulted in extra work producing an ‘A’ journal publication (2013 ABDC Rankings); while another Honours student (Tanya Tran), collected high-detail (categories, prices, etc.) annual AFL membership data for many years/teams, which now forms a useful database for my future research with significant possible future intellectual property value.

Rugby’s ‘Bonus Points’ Work – Policymakers Should Take Note (AFR Piece)

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I had yet another opinion piece that appeared in this morning’s edition of the Australian Financial Review (Friday 22 August), titled: “Use Bonus Points to Encourage Crowd-Pleasing Play” (link gated), on p.35. Alternatively, if you don’t have the hard copy, e-mail me a request.

It discusses research I have undertaken with Niven Winchester (MIT) on estimating the effect of the try bonus in Rugby to alter behaviour of players and coaches to produce more attacking rugby to score more tries, which after all is what the punters want.

It develops ideas discussed in this blog a few years ago. The paper title itself is the somewhat more esoteric: “Secondary Behavioural Incentives: ‘Field’ Evidence on Professionals”…hopefully coming soon to a good peer-refereed economics journal near you!

More on Optimal Sequencing: Soccer Edition

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[Cross-posted at: Wages of Wins Journal, 7 August 2014]

This earlier Wages of Wins piece by Shane Sanders (July 29, 2014) generated plenty of discussion. It highlighted the problem of Triathlon deaths in the swim leg. One crucial point to make with many economic policy analogies on which to draw is that sequencing of the legs (or phases) matters – all other considerations aside, the ‘best’ sequence of phases can be optimized according to some objective (in this case, minimizing fatalities).

One such possible economic policy analogy is with respect to unemployment benefits. Imagine a two-phase policy, where in the first six months the recipient is eligible to a relatively unrestricted entitlement of an amount according to some predefined percentage (say 40%) of some benchmark (average weekly earnings or minimum full-time wage). If the recipient is still unemployed after the 6 months have elapsed, a second phase kicks in at which the benefit is now highly restricted thereafter (having to satisfy minimum job search requirements, etc.) and/or reduced in value. Now, many people will disagree as to whether this two-phase policy is too generous or too miserly (or even on the basis of something else entirely). However, one aspect most of us would agree on is that swapping the sequence of these two phases would make absolutely no sense whatsoever.

It got me thinking about other such analogies about sequencing from sport that could be useful in policy circles. Recently, I published an article in the December 2013 issue of Journal of Sports Economics [gated], along with Jan Libich (my colleague at La Trobe) and Petr Stehlίk (University of Western Bohemia, Czech Republic). We took on soccer’s penalty shoot-out problem.  In knock-out matches that are tied after 90 minutes, the following 30 minutes of overtime is often beset with overly-defensive play due to insufficient incentive to attack.   This means that overtimes often finishes goalless, and that nearly 50% of the time, the match is decided via penalty kicks anyway (put differently: in nearly one of every two ties, overtime fails to achieve the one and only thing it is fundamentally there to do).

We show that an alternative sequence – regulation time followed by a penalty shoot-out followed by overtime – improves attacking outcomes. The qualification is that, while the shootout produces a winner – you still play overtime, with the winner of that winning the contest as currently. It is only when overtime fails to resolve the deadlock that the winner becomes the team that had won the shootout already (think of winning the shootout as worth half-a-goal lead at the start of overtime).

Specifically, we show that the probability of at least one goal being scored in overtime rises by approximately 50% (depending on the underlying characteristics of the match). Exactly how we estimate the effect of a policy that’s never existed is outlined in the paper for those of you who are interested to read further.

Coming back to sequencing, why the simple economic intuition (as well as the data) says this rule change will likely work is the following: there will always be one team chasing the next goal, because they will be eliminated unless they do – they have little else to lose. While the other team may correspondingly become more defensive, we show the net effect to be overwhelmingly positive. Furthermore, what you will no longer get are those overtimes where both teams sit back having jointly overestimated the probability that they will win if it goes to a shootout.

Had Mario Götze spurned that chance just minutes from time in the recent World Cup final, and it had have instead gone to spot kicks, the penalty shootout problem would now be far higher on the soccer agenda. Nonetheless, better public policy (optimal sequencing included) should never be far from the agenda, so I hope to see more studies like this make some impact in the broader public policy debate.

H-Index Boost!

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According to Scopus, my h-index has just hit the heady heights of…wait for it…4. Curiously, my hInorm-index (explanation of numerous common impact metrics here) also becomes 4 simultaneously. According to Harzing’s Publish or Perish, the analogous numbers come in at 9 and 6, respectively. If I was a UK astronomer, I’d surely still be kicking around in Sunday League. However, I’d like to think that these numbers are quite respectable within my own cohort (incomparable across disciplines for numerous reasons). Unrequited thanks to Egon Franck and Marcus Lang for the citation that pushed me over the line.

Sports Symposium

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On Wednesday, I attended a wonderful Sports Symposium event, hosted by La Trobe’s Centre for Sport and Social Impact (CSSI), of which I am a staff member. It was aimed primarily at young hopefuls who wish to make a career in the sports industry. The guest speakers included notable AFL figures Geelong CEO Brian Cook, The Age sports reporter Emma Quayle and player agent Paul Conners (Conners Sports Management). Each of the speakers had some special nuggets of wisdom to impart. ‘Tenacity’ was a big theme for each of them.

CSSI Director Professor Russell Hoye tells me that this is set to become a semi-regular event. I can’t wait to see who is on the bill for the next one. I’ll be there with bells on.

Anti-Tanking Policy in the AFR

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My newspaper op ed piece appeared this morning in the Australian Financial Review (Thursday 31 July), regarding my suggestion to circumvent tanking in pro-sports leagues with reverse-order drafts (see also this earlier post) called: “Stop Tanking: Rank Draft Picks by Finals Exit, Not Ladder“. See p.51 of the hard copy if you have it, or e-mail me a request (the link is gated). The timing is excellent – these things are often talked about long after the incident itself, typically round about when rumours surface of an impending investigation (or even later). Far better to spotlight the issue before the damage might actually occur.