# An Algorithm from New York

Writing for The Wages of Wins Journal is fun, but not really an important part of my job. To keep my focus on my work I have adopted a rule of no more than one post per day. Yesterday, though, Martha Cooley – who we mention in the book – alerted me to a story from the New York Post. So I have decided to break my rule today to offer a brief comment.

The article by Reed Tucker – entitled “Algebra for Actors” – presents an algorithm for measuring the star power of an actor. Before his algorithm is presented, Tucker makes the following observation:

“What if our cinematic love has been misplaced? What if we just anoint these people our biggest stars because we’re supposed to? Because everyone else does?

A similar phenomenon happens in sports. The most famous, highest-paid and flashiest players are often considered the most valuable, simply because of their reputations and high profiles. It’s a huge problem for managers and owners because they could get stuck paying millions for someone who doesn’t actually help the team as much as his salary might suggest.

Economists David Berri, Martin Schmidt and Stacey Brook tackled just this problem in their book “Wages of Wins.” The trio created a complex algorithm that analyzed a basketball player’s numerous stats and spat out a “Win Score” – a number that assessed the true value of a baller, regardless of paycheck or hype.

Surprisingly, the cold, cruel formula determined that, for example, superstar Allen Iverson was just the 36th best player in the league – and that was during his best season.”

Why is this interesting? First, another New York paper mentioned our book, which is neat. Second….

Okay, there isn’t a second point. I think it’s neat that in the course of discussing something totally unrelated to sports a writer brought up our book.

Well, maybe there is a secod point. I know there is a literature examining the economics of movies. Although I am not entirely familiar with this research, I suspect someone has – or probably should – estimated the box office appeal of various stars. What Tucker argues is that people we think of as stars – such as Angelina Jolie – do not have the box office appeal one might suspect. In other words, like our discussion of basketball players in The Wages of Wins, how we perceive the star power of actors and actresses is not perfectly consistent with actual productivity.

– DJ