tag:blogger.com,1999:blog-21552987.post114681289258523251..comments2023-11-05T04:50:27.094-05:00Comments on Social Econ Blog: The Contract Year in the NBAUnknownnoreply@blogger.comBlogger5125tag:blogger.com,1999:blog-21552987.post-52156925191908692982009-06-09T00:05:15.822-04:002009-06-09T00:05:15.822-04:00While this model seems to incorporate most of the ...While this model seems to incorporate most of the aspects involved for this type of situation, i think that it would still be difficult to conclude that a player was not trying as hard because he just got a big deal a lot of times the reason for the decline in player output have much more to do with externalities. One example is that the player is signed by a different team than they played on the year before and the team simply doesn't play as well, or perhaps the the coach is not putting him in situations that he is comfortable with which will lead to a less productive player.Richard leenoreply@blogger.comtag:blogger.com,1999:blog-21552987.post-1147106632239757172006-05-08T12:43:00.000-04:002006-05-08T12:43:00.000-04:00You may want to check out chapter 5-3 of Baseball ...You may want to check out chapter 5-3 of <A HREF="http://www.amazon.com/gp/product/0465005969" REL="nofollow">Baseball Between the Numbers</A>, which takes on the contract year phenomenon in baseball. (Admittedly, I haven't read it through. Still on chapter 3.)Tony Vallencourthttps://www.blogger.com/profile/06640680964080820351noreply@blogger.comtag:blogger.com,1999:blog-21552987.post-1147020607554113842006-05-07T12:50:00.000-04:002006-05-07T12:50:00.000-04:00I think the most effective way to deal with Varun'...I think the most effective way to deal with Varun's concern is to (as I mentioned at our original meeting) include a trend variable. That is, you should have a control for the number of years the player has been in the NBA in your regression.BWhttps://www.blogger.com/profile/15253628675169664406noreply@blogger.comtag:blogger.com,1999:blog-21552987.post-1147009177811554822006-05-07T09:39:00.000-04:002006-05-07T09:39:00.000-04:00I think another approach, and please correct me if...I think another approach, and please correct me if I am wrong Bryce, is to use a differences in differences approach. The reason for this is that one reason players might do better the year before their contract is because they had an extra year to get better. While this may not apply to players like Kobe, it certainly applies to playes in the league under five years. First, I think you should eliminate rookies with one year contracts from the sample because you have no standard to compare their improvement against. Then, I think you should calculate the average difference in performance during non-contract years and subtract it away from the difference in performance in a contract year. This should also eliminate any player fixed effects and isolate the effects of the contract.Varun Akulahttps://www.blogger.com/profile/13678721834664398137noreply@blogger.comtag:blogger.com,1999:blog-21552987.post-1146930255939211762006-05-06T11:44:00.000-04:002006-05-06T11:44:00.000-04:00Alex, The two issues here are pretty clear. You s...Alex, <BR/><BR/>The two issues here are pretty clear. You seem to have a reasonably good grasp of this. <BR/><BR/>Empirically, you seem to be struggling a bit. <BR/><BR/>For the first hypothesis, you want to estimate equations using individual fixed effects. That is, you want to run:<BR/><BR/>output of player i in year t = a + b*last year of contract(i,t) + [other things which might change player's performance in year]'*d + player fixed effect + e<BR/><BR/>to do this you type: <BR/><BR/>areg output contractyear [other controls], absorb(player) <BR/><BR/>The trick is to appropriate control for other shocks to player producitivity. <BR/><BR/>For the second hypothesis, I think a basic OLS will be ok. The goal here is to compare the contracts of players who are basically similar but differ in how much "better" they play in their contract year. So you want to estimate something like: <BR/><BR/>contract = a + b*(contract year output) + c*(avg output in non-contract year) + [other player controls like position, height, age, ...]'*d + e<BR/><BR/>These may not be precisely correct, but they are on the right track. Just keep thinking about what you want to argue and what someone might argue who doesn't believe your estimates.BWhttps://www.blogger.com/profile/15253628675169664406noreply@blogger.com