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

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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!

RBA Rate Decisions More Powerful in Smaller Doses (AFR Piece)

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The Australian Financial Review ran an opinion piece of mine (with my colleague, Jan Libich) that appeared in this morning’s edition (Tuesday 7 April), titled: “RBA Medicine Should be Dispensed in Smaller Doses” on p.43 (some of you will find the link to be gated)…or e-mail me a request if you cannot access it any other way.

It discusses an idea of ours to improve the impact of central bank interest-rate setting in Australia, which is to reduce the increment of change to the cash target rate (the main monetary policy instrument), from 25 to 10 basis points. Such a change would incur a relatively small adjustment cost, while providing a good return on extra ‘signalling power’. Read the piece to get more detail.

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!

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!

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.

Why Oz Soccer Fans Should Cheer for the Chinese Economy

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My latest Australian Financial Review piece: “Sleepless in Skipton: Long Slog for Local Soccer Fans” appeared in today’s edition (Friday 27 June). The link is gated; though it’s on p.43 of the hard copy if you can get your hands on one.

If you’re an Australian World Cup tragic who has been horrendously sleep-deprived over the previous fortnight, you get a lot of sympathy from me in it.