The Frankish Reich Posted October 9, 2017 Posted October 9, 2017 (edited) Richard Thaler won the Nobel Prize* in economics today. An unusually interesting guy within the so-called "dismal science," I see that he even took a look at market inefficiencies in the NFL draft. Because we're all about the Bills, let me summarize from our perspective: trading down for Tre White = smart. Trading up for Sammy Watkins (maybe for Zay Jones too?) = not so smart. (Note: this is somewhat dated, before the current CBA changed draft compensation slot rules, but the general point stands) http://www.nytimes.com/2010/04/04/business/04view.html?ref=business *Yeah, technically not a Nobel Prize because not established by Nobel, but that's how it's become known. How confident should a team be that this early pick is better? Suppose we rank all the players at a given position — running back, linebacker, etc. — in the order they were picked in the draft, then compare any two in consecutive order on the list. What do you think is the chance that the player picked higher will turn out to be better — as judged, say, by number of games started in his first five years in the league? If teams knew nothing, the answer would be 50 percent, as it would be for flipping a coin. If they had perfect knowledge, the answer would be 100 percent. Go ahead, make your guess. The answer is 52 percent — an outcome that is barely better than that of a coin flip. This means that although the value of players declines throughout the draft, quality declines more slowly than compensation — players picked early are very highly paid. As a result, the first pick in the draft has often provided less value to his team, in performance per dollar, than the last pick in the first round (the one awarded to the Super Bowl winner). In other words, in the world of the N.F.L. draft, the rich get richer. Edited October 9, 2017 by The Frankish Reich
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