Evaluating Player Value in the Major Leagues: An Economic Analysis

Project options and overview

The project will provide students with an opportunity to investigate the economic value of players using game statistics and payroll information. The project has three options. Please choose ONE option. 1. Choose one team-season from the Major League Baseball Association, download player statistics of a recent season from Baseball Reference like in the Week 9 Tutorial exam- ple. Use the Scully-Blass approach of Measuring Marginal Revenue Product (MRP), outlined in the lecture notes and in the tutorial, to evaluate all the hitters from the team who were on the team for the entire season. Compare the calculated MRPs with the payroll information to assess player value: who is overpaid and who is underpaid?, and discuss why. The “why” can involve a failure of the method or a failure of the market or both and should be based on your personal intuition including (if applicable) your knowledge as a fan. 2. Choose one team-season from the National Basketball Association, download player statistics of a recent season from Basketball Reference like in the Week 11-12 Tutorial example. Use the PIPM method (explainer here) of calculating on-court value (from the Tutorial slides), to evaluate all the players who spent the entire season with the team, and then calculate the MRPs using the version of the Scully method covered in the Tutorial slides. Compare the calculated values with the player salary rankings – who is relatively overpaid and who is relatively underpaid? – and discuss why. The “why” could involve a failure of the method or a failure of the market or both and should be based on your personal intuition including (if applicable) your knowledge as a fan. 3. Choose one team-season from the National Hockey League, download player statistics of a recent season from Hockey Reference like in the Week 11-12 Tutorial example. Use the Points Shares method (explainer here) for calculating on-ice value in terms of points created (from the Tutorial slides), to evaluate all the players who spent the entire season with the team. For hockey players, you don’t need do a direct MRP calculation 1 from the Point Shares. Instead, compare the calculated Point Shares rankings for the team with the player salary rankings – who is relatively overpaid and who is relatively underpaid? – and discuss why. The “why” could involve a failure of the method or a failure of the market or both and should be based on your personal intuition and can incorporate your knowledge as a fan. As discussed on the syllabus, this project can be done either alone (N = 1) or in teams of size N > 1. N can be any number of members but there is a off-the-top penalty of N ? 1 marks to account for the labour savings to individual group members from group work. Un- like the first data project, each project must be based on a unique team-season from one of the three leagues, so email me to reserve your team-season and let me know your group. If your team-season of interest is already taken I will suggest a related one, e.g. the Oilers in 2018-19 rather than the Oilers in 2019-20. The overall length of the project should be no more than 7 pages and the overall word counts should be approximately 900 to 1400 words. For the first project, some groups had trouble staying under the word limit and, if so, that’s generally ok so long as the project doesn’t get too long. Make sure your project submission is double spaced, has a title page including all the group members names (not included in the word or page count), and a bibliography that lists your data sources. Only one member of the group needs to upload to D2L. This project can be most likely be completed in a spreadsheet format. The report may have references (either in text, as footnotes, or as endnotes) and should have a bibliography, which should include links to whatever (exact) webpages you pulled your raw data from as well as any other sources you used to inform your analysis. There are two main methods of citation: The American Psychological Association (APA) format of citing references, or, the Modern Language Association (MLA) format styles of citing sources. If you prefer a different format method for citations, that is also fine with me so long as the references in the paper are easy to parse and consistent, and the bibliography makes your sources clear. As this is a writing project, it is important to keep in mind that it must be written in your own words with properly referenced research sources. Any evidence of plagiarizing will be penalized heavily. In particular, you can share work freely within your project group of size N but evidence of cross-group copying will be very closely scrutinized and penalized. If you find yourself working closely with another group, join your two groups togethe