IJSF Issue 2:4

Contents for IJSF Issue 2:4

Moneyball as Sport Finance in Action: But are the Lessons from Baseball More Generally Applicable?, pp. 175-176
Authors: Bill Gerrard and Dennis Howard
Abstract:Moneyball: The Art of Winning an Unfair Game (Lewis, 2003) is in essence the story of how the Oakland Athletics under its general manager, Billy Beane, have successfully challenged bigmarket rivals such as the New York Yankees in recent years yet have typically spent only around one third of the Yankees in player salaries.

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The Moneyball Anomaly and Payroll Efficiency: A Further Investigation, pp. 177-189
Authors: Jahn K. Hakes and Raymond D. Sauer
Abstract:In our 2006 paper, we examined the implications of Michael Lewis?book for the labor market in Major League Baseball. Our tests provided econometric support for Lewis?claim of mis-pricing in the baseball labor market’s valuation of batting skills. We also found suggestive evidence that the dispersion of statistical knowledge throughout baseball organizations was associated with a sharp attenuation of the mis-pricing. This paper takes a closer look at the economic issues raised by Lewis for the baseball labor market. We extend the sample both backward and forward in time, seeking to determine how long the pricing anomaly existed, and whether the recent attenuation in the anomaly is robust to new observations. In addition, we refine the measures of skill used in our tests to more closely match the narrative account in Lewis?book. Using both our earlier and refined measures, we find that the pricing anomaly extends well before the period described in Moneyball, and that with some important caveats, the market correction in the post-Moneyball period persists. Finally, improvements in personnel management associated with a closer link between pay and performance may be responsible for the sharply increased correlation between winning percentage and payroll in recent years.

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Does One Simply Need to Score to Score?, pp. 190-205
Authors: David J. Berri, Stacey L. Brook, and Martin B. Schmidt
Abstract:Professional sports are characterized by an abundance of information on worker productivity and severe consequences for failure. Consequently, one would expect information to be processed efficiently in this industry. Recent research indicates, though, that decision makers in professional sports do not behave consistently with the dictates of instrumental rationality. This study of decision making in the National Basketball Association (NBA) begins with a literature review that indicates players can score a major payday by simply focusing on scoring. Beyond this review, we offer an empirical investigation of both the voting for the All-Rookie team and the determination of player salary that clearly indicates that the ability to accumulate points dominates player evaluation in the NBA. Given that such a focus is not consistent with winning games or maximizing profits, we argue that decision-makers in the NBA do not behave according to the dictates of instrumental rationality.

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Putting Moneyball on Ice?, pp. 206-213
Authors: Daniel S. Mason and William M. Foster
Abstract:This paper discusses the application of Moneyball management to the hockey industry. Following a review of Moneyball and sabermetrics in other sports, attempts to apply similar practices in hockey are reviewed. Moneyball in the National Hockey League is then examined, where adoption is limited by several factors: 1) the statistics available and their usefulness in evaluating player contributions to team performance; 2) the nature of the cooperation of players to produce outputs; and 3) the willingness of league insiders to embrace Moneyball. The statistical issue may be partially addressed by the introduction of new tracking technologies that can obtain new data, while teams may be more willing to explore Moneyball as teams who do so are successful. The development of new statistical measures are now helping to break apart the contributions that each player makes to team wins; however, the acceptance of these new measures will be limited by the speed by which teams adopt the new metrics. Finally, the recent imposition of a salary cap for NHL players will increase the value of using Moneyball analyses in hockey, as general managers and other team administrators are faced with a much smaller margin of error vis-à-vis evaluating and valuing player performance in hockey.

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Is the Moneyball Approach Transferable to Complex Invasion Team Sports, pp. 214-230
Authors: Bill Gerrard
Abstract:This study analyzes reasons for the successful of the Oakland Athletics in Major League Baseball as described in the bestseller, Moneyball. Benchmarking analysis is conducted to quantify the extent of Oakland’s achievement. The use of player performance analysis to develop a knowledge-based “David” strategy is investigated. The difficulties of applying the Moneyball approach in more complex invasion team sports are discussed. A hierarchical structural model of an invasion game is proposed as a conceptual framework and its application illustrated using data from English Premiership soccer. The technological, conceptual, and cultural barriers to the transferability of the Moneyball approach to other sports are assessed.

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Moneyball Applied: Econometrics and the Identification and Recruitment of Elite Australian Footballers, pp. 231-248
Authors: Mark F. Stewart, Heather Mitchell, and Constantino Stavros
Abstract:The best selling book Moneyball posited a theory on the success of a Major League Baseball franchise that used detailed match data to identify inefficiencies in the market for professional baseball players. These statistics were then exploited to the advantage of that team. An important part of this strategy involved using mathematical techniques to identify which player statistics were most associated with team success, and then using these results to decide which players to recruit. This paper uses a similar approach to analyze elite Australian Football, making use of various types of regression models to identify and quantify the important player statistics in terms of their affect on match outcomes.

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Moneyball: A Business Perspective, pp. 249-262
Authors: Richard Wolfe, Kathy Babiak, Kim Cameron, Robert E. Quinn, Dennis L. Smart, James R. Terborg, and Patrick M. Wright
Abstract:Moneyball (Lewis, 2003) is a book about baseball. The book describes how a small-market Major League Baseball team, the Oakland Athletics, has been able to compete with large-market teams by being innovative in a tradition-laden industry. However, when read through a business management lens, one discerns that this baseball book, in fact, has general management lessons in a variety of areas including leadership, innovation, overcoming resistance to change, and creating a sustainable competitive advantage. In this article, we outline and illustrate the valuable lessons for business that emerge from the Moneyball story. More specifically, we provide a brief overview of the book; summarize arguments for applying Moneyball ideas to management as presented in the popular media as well as in academia; determine the underlying management themes contained in the Moneyball story; and propose Moneyball lessons for managers.

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