The Freaky Part of the Lockout

Check out Freakonomics for a guest post by none other than our esteemed General Manager David Berri.

Monopoly vs. Monopsony: The Economic Battlefield of the NBA Lockout

Dave reviews some of the problems in the lockout including.

  • Monopolies vs. Monopsonies: As Patrick went over a while back the NBA players have a Monopoly on the talent and the NBA owners have a Monopsony, which means they are the primary buyer of the good. It’s hard to know who will win when these two sides clash but a lot of it has to do with making sure to bargain and leverage correctly, which the players have not been doing.
  • Big Markets vs. Small Markets: As we’ve said the real problem between big markets and small markets is not competing on the field of basketball, it’s in earning money. Dave reviews that in MLB the big market teams decided to subsidize the small market teams. In the NBA the owners are instead asking the players to pick up the check. The players are not happy about this.
  • The Fans Come Back: Finally Dave reminds us that he and Martin Schmidt found out that the fans comeback after work stoppages. So at the end of the day the real losers of this lockout are the fans.

You should hop over to Freakonomics and read the rest. If you really enjoy it make sure to let them know in the comments that Dave should write more stuff for them.

-Dre

How a Sports Economist Talks Smack

Dave Berri, the General Manager of the Wages of Wins Network, is a lifelong Detroit Lions fan. I myself am from Denver Colorado and as a result am a Denver Broncos fan. This Sunday our teams will meet and that of course required some amount of smack talk. I thought you all would enjoy a look at how a Professor in Sports Economics talks smack:

Here is the real contest:
Will Tim Tebow:
A) Survive the game?
B) Get knocked out of the game and watch from the sideline?
C) end up in a hospital
I think (b).  What do you think?
We’ll have to wait until tomorrow to find out!
-Dre

What’s the Deal with Football on TV?

Here at the Wages of Wins we are lucky enough to have a resident Sports Economist on staff. When we have crazy questions about things like the cost of beer and its effects on ticket prices we need only e-mail Dr. David Berri to get the lowdown. This week Mosi Platt (@MIA_Heat_Index) of the Miami Heat Index was interested in the NFL and college football on TV and the good doctor was kind enough to chime in. Here are Mosi’s questions and Dave’ answers.

Why do the BCS & NFL handle TV so differently?

The BCS is every school/conference for itself, but the NFL negotiates as one entity. Why is that?

The NFL under Pete Rozelle got a law passed through Congress in the 1960s that allowed the NFL to violate anti-trust laws.  The NCAA, though, was found guilty of violating anti-trust laws in 1984 (in a case brought by Oklahoma).  Since then, conferences and schools were able to cut their own deals.

Right, but why hasn’t an NFL owner bucked the system to forge their own TV deal? Couldn’t Jerry Jones make more money with his own deal for the Cowboys?

Maybe.  But Jones might have a hard time finding anyone to play if he tried to forge his own national deal.  The NFL has immunity to anti-trust laws on this issue.  So they can stop Jones from doing this.

So, as an economist, which organization is better at maximizing its TV revenue in you’re opinion – the BCS or NFL?

The difficulty with the BCS is that they have oversupplied the market, and that has reduced the price of each game.  But I am not sure of the actual prices.  So I am not sure how the revenue numbers compare (although I am sure someone knows).

Until next time

Hope you enjoyed a brief refresher on football on television. The next time we have a question for Dave we’ll make sure to post it.

-Dre

Wages of Wins Podcast: The Owners are still lying

Ask an Economist.

Dave was nice enough to hop on for a quick podcast before starting his weekend. You can listen to the whole thing here:

Wages of Wins Podcast 09/16/2011 – The Owners Are Still Lying

Dave appreciates his new staff of writers. He still chips in to brag about his “home teams”

Size does matter! The Difference between the NFL lockout and the NBA proves an old point. The NFL union has 1700+ members many of which with shorter careers. This means they cave quickly. The NBA has fewer members but this may not keep them from caving.

The NBA Owners refuse to show us their books. Given the background, it’s hard to believe them when they say they’re losing money. If they are, it is probably their fault as they are reckless in their spending.

We kept it short as the weekend was fast approaching but we hope you enjoy it!

-Dre

A Perfect Sports Weekend!

That's not a football or basketball!

Dave Berri is the General Manager of the Wages of Wins Network.  He is a Professor of Economics at Southern Utah University, lead author of both “The Wages of Wins” and “Stumbling on Wins”, and past president of the North American Association of Sports Economists.

Hear that? It's the sound of Dave Berri WINNING

When sports economists are asked why they study sports, the answer quickly focuses on the immense data sports provide.   Such data allows one to study a host of issues of interest to economists (even those who don’t like sports).

Although such answers are necessary when confronted by economists who don’t like sports (i.e the real nerds in economics), let’s be honest.  We study sports because we like sports.

As a sports fan I definitely follow in the “Seinfeld tradition”.  What that means is that I definitely root for the clothes (as Jerry Seinfeld once noted about sport fans).  And because I have moved a bit in life, there are many clothes I follow.

For example…

  • I grew up in Detroit so I follow the Tigers, Lions, Pistons, and Red Wings.  I also follow the Michigan Wolverines.
  • I spent my teenage years in Nebraska, so I follow the Nebraska Cornhuskers.
  • I went to graduate school at Colorado State (where I met my wife), so we also follow the Rams.
  • And we chose to come to Southern Utah University a few years ago, so we also follow the Thunderbirds.

Given all these teams, it is likely that on any given weekend during the football season, someone will make me happy and someone will make me sad.

Except for this weekend.  This past weekend… well, let’s say it went well.

  • The Tigers swept the Minnesota Twins and are now 10 ½ games up in the Central Division (and are tied for the second best record in the American League).
  • The Colorado State Rams defeated Northern Colorado (Colorado might proved to be a bit more difficult next weekend).
  • Southern Utah defeated Sacramento State.  My family attended this game and were worried that Sacramento State – who defeated Oregon State last weekend – would be very tough.  But the T-Birds dominated, winning 35-14.  Our quarterback – Brad Sorensen – may be drafted by an NFL team in the future.
  • Nebraska struggled to defeat Fresno State, but ultimately prevailed.
  • Michigan did not look good against Notre Dame.  But thanks to an amazing 4th quarter, the Wolverines managed to defeat the Irish.
  • And today – while the Tigers were sweeping – the Lions went down to Tampa Bay and dominated the Buccaneers.  Yes, the Lions only won 27-20.  The final score, though, was not entirely indicative of how the Lions played.  After Tampa took an early lead, the Lions seemed to have their way with the Buccaneers.

With the Lions’ victory, my “perfect” weekend was complete.

At least, until I looked up what Nebraska Wesleyan did this weekend.  I attended NWU as an undergraduate.  And unfortunately, they lost this weekend.  I would note, although I had friends on the football team twenty years ago, I never really followed the Prairie Wolves (who were called the Plainsmen when I attended) football team.  But if I did, then my weekend was still almost perfect.

By the way, prior to this weekend I always held an irrational belief that all my football teams couldn’t win on the same weekend.  So after Michigan won last night, I thought the Lions were doomed.  Of course, such a belief is silly.  And thankfully, silly got shot down this weekend.

Then again… if I am this happy this weekend, what chance do my teams have next weekend? Yes, irrational thoughts are hard to eliminate.

- DJ

P.S. I also worked for three years at Coe College, and they also lost this weekend.  Like Nebraska Wesleyan, though, I never followed football much at Coe.

One last note… Cal-State Bakersfield – where I worked before SUU – doesn’t have a football team.