This morning it was reported at ESPN.com that the Boston Celtics have signed Rajon Rondo to a five year contract, worth at least $55 million. This is not the maximum salary the Celtics could have offered, but it does top the $45 million offer the Celtics were reportedly offering before.
Had Rondo not signed he would have been a restricted free agents when the 2009-10 season ended. In other words, Boston would have still had a chance to re-sign Rondo when the season ended; and at the moment, the Celtics were not bidding against anyone for Rondo’s services. So did the Celtics overpay for a point guard who averages less than 12 points per game?
As is often noted, an NBA player’s impact on wins extends beyond his per game scoring average. And when we look at the entire box score –and covert those numbers into wins – we see that Rondo is a very productive player. Last year he produced 17.2 wins for the Celtics. No player wearing Celtic green – as Table One reports – produced more last season.
Among point guards, only Chris Paul (28.2 Wins Produced) and Jason Kidd (19.8 Wins Produced) offered more. And in the entire NBA, Rondo ranked 7th in Wins Produced. In sum, last season Rondo was the most productive player on the Celtics, and ranked in the top ten among all NBA players.
Rondo, though, is not going to be paid like a top 10 NBA player. To put his new contract in perspective, here is what some point guards are being paid who produced less than Rondo last year (contract details from the website of Patricia Bender and USA Today):
Chauncey Billups: 5 years at $60 million [12.8 Wins Produced in 2006-07, 10.0 Wins Produced in 2008-09]
Baron Davis: 5 years at $65 million [10.7 Wins Produced in 2007-08, 1.5 Wins Produced in 2008-09]
Tony Parker: 6 years at $66 million [5.3 Wins Produced in 2003-04, 8.5 Wins Produced in 2008-09]
Deron Williams: 4 years at $63.7 million [14.2 Wins Produced in 2007-08, 10.9 Wins Produced in 2008-09]
The production numbers are from the year before each of these players signed his contract (as well as what the player did last year). As one can see, each of these point guards is paid at least as much per season as Boston is reportedly going to pay Rondo. None of these guards, though, produced 17.2 wins in the season before their current contract was signed. In fact, these four guards have never produced that many wins in a single regular season.
So why don’t the Celtics raise their offer? The obvious answer is that player salaries in the NBA are not determined by Wins Produced. The primary determinant of salaries is scoring, and Rondo is not much of a scorer. Last year he only averaged 11.9 points per game; and on a per-minute basis, he was below average for a point guard.
If we examine what Rondo should be paid – according to the logic of the NBA’s free agent market [something we discussed in The Wages of Wins and in a published article in 2008] – then Boston’s original offer was closer to the mark. So by the logic of the NBA’s free agent market, the Celtics are over paying a bit (but not much).
When we look at this contract from both sides, one could argue both the team and player may not be happy with this contract. Boston is probably paying Rondo more than any other team would have offered. And Rondo – if we think about his contribution to wins – is underpaid.
So what can we do to make everyone happy? From the Celtics perspective, Rondo should focus more on scoring. If he averaged about 15 points per game – which he could if he simply took about three more shots per game (or less than one per quarter) – then Rondo’s pay would match what he should get according to the logic of the NBA’s free agent market. Of course, Rondo would still be producing more wins than his would pay would suggest. To put his production of wins in line with his paycheck, perhaps Rondo could reduce his production of wins by committing a few more turnovers or reducing his steals. NBA players aren’t paid for turnovers and steals, so changing these numbers won’t change people’s perceptions of his performance. Changing these numbers, though, will alter Rondo’s production of wins.
Assuming none of these changes occur, I will make the following predictions:
1. Rondo will continue to produce more than he is paid. Because he does not rely on scoring to produce wins, the NBA player market will continue to undervalue Rondo’s services.
2. Given the age of Kevin Garnett, Ray Allen, and Paul Pierce, we can expect the productivity of Rondo’s key teammates to decline in the near future. When this happens – and the Celtics start winning less often – perceptions of Rondo’s pay will change. Specifically, when the Celtics are not one of the top teams in the NBA, someone will argue that the Celtics overpaid for Rondo.
Let me close by noting that The Wages of Wins was published in 2006, and the free agent model reported has been updated since that time. As of 2008 – I have not added data from this past summer yet – the story told in The Wages of Wins still stands. Scoring dominates perceptions of value in the NBA (and you see the same story with respect to other decisions). And as long as this continues – and as long as Rondo maintains his production of wins — the money Rondo receives will not be consistent with his contribution to team wins.
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Our research on the NBA was summarized HERE.
Wins Produced, Win Score, and PAWSmin are also discussed in the following posts:
Finally, A Guide to Evaluating Models contains useful hints on how to interpret and evaluate statistical models.