Tanking for Superstars

Occasionally in professional sports, an athlete comes along who is miles above everyone else. Tiger Woods, Sidney Crosby, or–right now–Connor McDavid.  That one guy who, when he’s still a young teenager, is predicted to break records in his sport.  Every team wants this guy, because he’s a once-in-a-generation talent, a guy who wins championships and brings in paying fans just by his presence.

And that’s creates a problem, because how do you determine which team gets him?  Almost always, sports leagues have the same answer.  For some reason, professional sports teams are able to ignore anti-competitive laws — they don’t have to compete monetarily to hire young athletes to play on their team. Instead, typically, they run a lottery including only the worst teams in the league.  Whichever team wins the lottery gets their pick of players. If you win, you’ll get the superstar and only have to pay him a fraction of the price he’d get in a free market.

Obviously, this is an amazing thing for whichever team wins the lottery. So much so that you have to wonder, is it worthwhile deliberately losing games in order to ensure your team is in the lottery, just to get a chance at a superstar player?

For the fans

For the fans of great teams who have a reasonable chance to win a championship, tanking doesn’t make sense.  It’s rare to have a top-tier team, so when you have it, you have to take that shot at the championship.

For a mediocre team, tanking is more interesting. People always say that in the playoffs, anything can happen.  But you know what?  It almost never does.

In the NHL, there are two 8th ranked teams who make the playoffs, one in each half of the league.  Since the 1940s, only one of these teams has ever won a Stanley Cup — the 2012 L.A. Kings.  So what are those odds?  About 1 in 150?

As a fan, given a choice, would you prefer a 1 in 150 chance of winning a championship?  Or would you prefer to miss the playoffs entirely, for a chance to get the player of his generation, the one who will entertain you for years and has a real chance of bringing in three or four championships?

It seems very clear to me.  The faint hope of a one year playoff run when you’ve already shown that you aren’t even close to the best in the league? Or the chance at years of entertainment?  Why wouldn’t fans choose the latter?

The owners’ perspective

Tanking seems good for the owners too. If a team is eliminated quickly in the playoffs, the owner will have a few home games, worth several million dollars in revenue each.  On the other hand, if they draft the superstar player, the rewards are huge.

First, they get a great player for a few years at significantly less than their fair market value. Second, they get that player bringing in fans over the course of several seasons — 41 games in hockey.  Either they’re filling more seats, or they’ll be raising ticket prices for all their seats, or both.

What’s more, if that player takes them deep into the playoffs with home advantage, they will have the revenue from all those playoff runs.

So, for the owners, tanking is gambling a few million dollars today for the chance to bring in hundreds of millions over the next 10 years or more.

How about the players?

The players are the only ones who are likely to lose by tanking. Theses athletes have a limited career. During that time, they want to maximize their chance of winning the championship (because most professional sports players get there because they are extremely competitive). And, they want to maximize the money they make over their short careers.

Tanking to bring in a superstar is unlikely to maximize their salary for two reasons.  First, players would tank by playing poorly, but playing poorly isn’t likely to lead to huge contracts, but rather hurt the value of that player.

Second, teams have limited budgets.  Over the short term, the superstar will be cheap. Over the long term, they will likely become the highest paid player on their team, and probably the league.  That will leave less money for the other players.  So economically, if you’re one of those players, it isn’t so good for you (except to the extent that playing with the superstar makes you look good too).

It also doesn’t make sense from the perspective of maximizing the chances to win a championship. First, the player would be throwing away one of their 10-15 potential opportunities to play for the championship. Second, teams turn over quickly. So even if you are on the team today, there is a good chance that, three years down the road when that superstar had developed enough to win you the championship, you will be on some other team. It’s fairly likely you’ll be playing against the superstar, not with them.  So, if you want your championship and want your money, it’s better not to tank.

The bottom line

Of course, I’m completely leaving out whether it’s ethical to tank for a good player. Assuming it isn’t against the rules, I think it is.  After all, everyone is supposed to be trying to maximize their chance to win, and why would maximizing the short term chance to win (i.e. not tanking) be any more ethical than maximizing the long term chance to win.

So, I think it’s in almost everyone’s interest to fail. Let the tanking begin….

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