No correlation between salary and wins?
Re: No correlation between salary and wins?
I think Murphy, just as Zimbalist, miss the point that the only data we have for basketball is in a capped world. Do they really think if there wasn't a cap, that money wouldn't matter? I don't.
Re: No correlation between salary and wins?
The largest correlation I can find in MLB data, across single years or multiple, combining multiple years for a team or not, is .7. Baseball still has some spending restrictions, like a rookie scale, but probably represents the closest thing to an uncapped world that you would see today. So even then, in a sport that is the poster child for advanced stats and player analysis, half of winning is unrelated to salary.EvanZ wrote:I think Murphy, just as Zimbalist, miss the point that the only data we have for basketball is in a capped world. Do they really think if there wasn't a cap, that money wouldn't matter? I don't.
A better test might be if anyone has pre-lockout NHL data. There were no spending restrictions at all; presumably the correlation should be above even baseball's.
Re: No correlation between salary and wins?
If .7 is salary-related, and .5 is unrelated to salary, what's the other minus-.2 from?
Re: No correlation between salary and wins?
You have to square correlations to get R2 (proportion of variation explained): .7^2 = .49 ~ 1/2.Mike G wrote:If .7 is salary-related, and .5 is unrelated to salary, what's the other minus-.2 from?
Re: No correlation between salary and wins?
Thanks, Mike (from the dumb kid at the back of the classroom).
Re: No correlation between salary and wins?
Sorry to call you out here, but this is repeating the same lazy thinking in my opinion. Your claim is that 50% IS related to salary. I know you said it the other way (50% unrelated to wins), but we all realize the correlation is not 100%. But 50% is huge! We all do stats where 20% or 30% (maybe even 10% sometimes) is considered large. The issue at hand is not whether salary explains 100% of wins. It's an existential question - does it matter at all? Yes, it clearly does.xkonk wrote:The largest correlation I can find in MLB data, across single years or multiple, combining multiple years for a team or not, is .7. Baseball still has some spending restrictions, like a rookie scale, but probably represents the closest thing to an uncapped world that you would see today. So even then, in a sport that is the poster child for advanced stats and player analysis, half of winning is unrelated to salary.EvanZ wrote:I think Murphy, just as Zimbalist, miss the point that the only data we have for basketball is in a capped world. Do they really think if there wasn't a cap, that money wouldn't matter? I don't.
50% is certainly enough to change who wins and who loses. At any rate, your own data validate my original point. Would anybody really want salary to explain *more* of winning by removing the cap altogether? I don't think any of us would want that. Yet the union economists say salary has nothing to do with winning. That's their talking point. Obviously, the players don't want a cap.
Re: No correlation between salary and wins?
That's actually what they're saying? And "independent" soothsayers are promoting this? Geez.EvanZ wrote:...Yet the union economists say salary has nothing to do with winning. That's their talking point. Obviously, the players don't want a cap.
Are a few of us here the only 'neutral' people who know for a fact that salaries have very much to do with winning? Of course, someone like Mark Cuban is acutely aware of it, because it costs him dearly to win a title. But is it supposedly a gray area?
Re: No correlation between salary and wins?
I thought it would be worth quoting myself from two pages back since it seems the thread is at this point now. So what do we want to make of the fact that there is some manner of correlation?xkonk wrote:In regards to the premise being refuted, maybe we should take a slightly different tact? What exactly do we really want to say if there is a correlation between salary and winning? We don't want to say that spending more causes winning, right? Because spending by itself is obviously useless; you have to spend the money on good players, and good players win. Do we want to say that spending more allows teams to get 'unfair' numbers of good players? Do we want to say that spending more allows teams to recover from mistakes? Do we want to make arguments about teams' ability to identify good players, a la Wages of Wins (I assume not, given the general perspective here). Let's assume everyone was willing to agree that there's a weak-to-middling league-wide correlation between salary and wins. Now what?
Re: No correlation between salary and wins?
If it was me, I'd put a hard cap on salary. Isn't that simple enough?
Re: No correlation between salary and wins?
Looking at correlations (and R2s) was appropriate but only a start.
The story is not simple. Despite cuts of analysis I've presented above about how big spenders (above average, top 30% or top 5) do well in the playoffs and going deep in them there are other ways to cut the data and see something different. Of the 22 teams who have spent $80+ million in a season within the last 6 seasons, there are just 2 champs and 2 additional finalists. Dallas had 2 of those 3. In 2006 Cuban spent $98 million on payroll (pre-luxury tax) the most spent by any finalist in the 6 year period (and probably the most ever inflation adjusted). Spending over $80 has worked 1/3rd of the time of the recent period for Cuban (they have been over $80 million every season) and 1 time in 2 for Buss (in the 70-80 million range 4 times, twice near but not over $80 million and that provided another title). Boston had the other Finals appearance while spending $80+ million. None of the other owners who spent over $80 million 12 times got a Finals appearance out of it. Gilbert got 1 conference finals out of his 3 times over $80 million. His team's Finals appearance came when the payroll was $63 million. Miami, San Antonio and Boston got their titles in the 60s and 70s in the early years where their spending still gave them an average spending rank of 10th.
Another cut though is to look at year to year progression of title winner spending. Beginning in 05-06 at a bit short of $60 million, it then went to $65m, $74m, $78m, $91m and finally $85 million. And the average spending of the champ in the last 4 seasons was about $82 million.
I am not convinced that the spending of the title winner will go down much, quickly. The much steeper luxury tax may cut down on the number of owners willing to venture over or way over $80 million in payroll but if instead of an average of 3.6 owners willing to do that in the last 6 seasons, it falls to say just 2 that might be attractive to the really passionate big spender.
Lower maxes, lower raises, lower MLEs, no biennial exceptions (which other teams coulduse to raise the price of desired vets above the minimum) and more teams likely using more caution with respect to the luxury tax will actually make it front-end cheaper and / or easier to pack your roster deep with sought after players / talent if you are willing to spend above everybody else. Cuban willing probably do it at least once or twice more. Same for Buss. Orlando, Boston and Portland will be up there but they have some choices still to make. Maybe NY gets back in that game, despite their track record. Atlanta and San Antonio seem unlikely. Miami probably won't get to $80 million next season but might in a future season if Riley wants to and can sell it. If he needs to. Chicago might in the future but not next season. It will be interesting how much restraint these owners actually show in the face of the more severe luxury tax. They may lessen the arms race or they might not. Will Paul Allen go above or way over $80 million again? I would not rule it out. He might be the only small market owner to do so, though maybe somebody else makes a 1-2 year exception to fulfill a lifetime dream, if everything aligns and it looks like "it is worth it".
Lots of talk about big & small markets but there really is an important difference between a relatively big market and the few huge markets and the difference between the two might become more important for spending and possibly going far or winning it all.
The story is not simple. Despite cuts of analysis I've presented above about how big spenders (above average, top 30% or top 5) do well in the playoffs and going deep in them there are other ways to cut the data and see something different. Of the 22 teams who have spent $80+ million in a season within the last 6 seasons, there are just 2 champs and 2 additional finalists. Dallas had 2 of those 3. In 2006 Cuban spent $98 million on payroll (pre-luxury tax) the most spent by any finalist in the 6 year period (and probably the most ever inflation adjusted). Spending over $80 has worked 1/3rd of the time of the recent period for Cuban (they have been over $80 million every season) and 1 time in 2 for Buss (in the 70-80 million range 4 times, twice near but not over $80 million and that provided another title). Boston had the other Finals appearance while spending $80+ million. None of the other owners who spent over $80 million 12 times got a Finals appearance out of it. Gilbert got 1 conference finals out of his 3 times over $80 million. His team's Finals appearance came when the payroll was $63 million. Miami, San Antonio and Boston got their titles in the 60s and 70s in the early years where their spending still gave them an average spending rank of 10th.
Another cut though is to look at year to year progression of title winner spending. Beginning in 05-06 at a bit short of $60 million, it then went to $65m, $74m, $78m, $91m and finally $85 million. And the average spending of the champ in the last 4 seasons was about $82 million.
I am not convinced that the spending of the title winner will go down much, quickly. The much steeper luxury tax may cut down on the number of owners willing to venture over or way over $80 million in payroll but if instead of an average of 3.6 owners willing to do that in the last 6 seasons, it falls to say just 2 that might be attractive to the really passionate big spender.
Lower maxes, lower raises, lower MLEs, no biennial exceptions (which other teams coulduse to raise the price of desired vets above the minimum) and more teams likely using more caution with respect to the luxury tax will actually make it front-end cheaper and / or easier to pack your roster deep with sought after players / talent if you are willing to spend above everybody else. Cuban willing probably do it at least once or twice more. Same for Buss. Orlando, Boston and Portland will be up there but they have some choices still to make. Maybe NY gets back in that game, despite their track record. Atlanta and San Antonio seem unlikely. Miami probably won't get to $80 million next season but might in a future season if Riley wants to and can sell it. If he needs to. Chicago might in the future but not next season. It will be interesting how much restraint these owners actually show in the face of the more severe luxury tax. They may lessen the arms race or they might not. Will Paul Allen go above or way over $80 million again? I would not rule it out. He might be the only small market owner to do so, though maybe somebody else makes a 1-2 year exception to fulfill a lifetime dream, if everything aligns and it looks like "it is worth it".
Lots of talk about big & small markets but there really is an important difference between a relatively big market and the few huge markets and the difference between the two might become more important for spending and possibly going far or winning it all.
Re: No correlation between salary and wins?
From 2005-6 to 2008-9 the champs each had just 3 guys at or over $7 million salary. The Lakers cranked it up to 4 to keep Bynum. This past season Dallas smashed that pattern and had 6 and almost 7. I would expect more champs in the near future to have 4-6. They might be rare within the league but I think the champs will tend to go for 4+.