Shameless self-promotion

I was mentioned in a story in the Daily Iowan about the impact of the Iowa football team on the economy of the area.

I-FCS Cupcakes

One of the more interesting topics in sports economics lately has been the market for cupcakes in college football, teams who are brought in just to get beat. These payouts can be quite profitable for small schools that cannot make big money selling tickets to their home games. Phil Miller and Stephen Karlson point to a story on Michigan bringing in Delaware State just to get beat. Delaware State had to forfeit a conference game to play the game:

You see, the Michigan Wolverines dangled $550,000 in front of the Hornets to play this Saturday. The only catch Delaware State already had a conference game set against North Carolina A&T set for that date.

So what did the Hornets do? Well what every Football Championship Series team would do: forfeit the conference game, take the money and, oh yeah, lose to Michigan 63-6.

I will quibble with one point made. I do not think every FCS (I-AA) school would do that. I do not think any team that has a shot at a playoff spot would make that decision. Also, FCS has a lot of schools that have long histories and reputations to protect. It is hard to imagine schools with prestigious reputations like William and Mary, Lafayette, or the Ivy League schools forfeiting a game for a payout. Also schools with strong reputations as top teams in FCS, even if they are having non-playoff seasons such as Georgia Southern, would not make this decision. Most of the schools most in need of the money may not feel comfortable enough with their position in their conference to forfeit a conference game. Because the MEAC is a conference made up specifically of HBC schools the connections between the schools may be stronger, and Delaware State might have been less concerned about punishment from the conference.

Given all of the reasons above, there are probably only a handful of teams in FCS that would make a similar decision.

White Flag Trades

Last week the Missouri S&T promotions department did a profile on the ongoing research of my undergraduate student, Samantha Schussele. She is doing a study on the effects on attendance of a White Flag Trade. A White Flag Trade is defined as a trade by a team of a key player for prospects when the team is still in contention for the pennant. Her research is continuing, and so far the effects on attendance are not clear.

Minor League Baseball Returns to Richmond

Minor league baseball is returning to Richmond, as the AA Connecticut Defenders will move there next year (H/T Sabernomics). Richmond for a long time had the AAA franchise of the Atlanta Braves. Before last season the team moved to Gwinnett County in exurban Atlanta. One advantage of this move was that having a AAA franchise nearby is advantageous to the major league team, since AAA players are often being called up to the major league team. However, the major issue was that Gwinnett County agreed to build a new stadium, while the park in Richmond was "old" (1985). J.C. at Sabernomics has covered the issue extensively over the last year (see here, here, here and many more).

A few years ago (data from 2003, published in 2006) I did a study looking at the relationship between minor league baseball team locations and various factors (population, income, distance from major league teams, etc.). However, it does not include stadium age or quality, which I was treating as an endogenous factor, i.e., a large city will have more resources to invest/waste on a ballpark. Over time baseball teams have distributed themselves very efficiently with few outliers from the predicted pattern. Table 6 of my paper presents the biggest outliers for AAA, AA, High-A and the metropolitan areas with no teams. According to the model, Richmond should have either a AAA or AA team (leaning towards AAA). If Richmond did not have a team at the time of the study, it would have been 5^th on the AAA list and 1^st on the other three. Richmond with no baseball team is clearly underrepresented by baseball.

Regardless of the stadium issues associated with the Richmond Diamond, the appeal of the Richmond market relative to Norwich, CT was too much for the Defenders' new ownership to ignore. Richmond's metropolitan area population in 2007 was 1,211,101, while Norwich's was 263,770. An additional one million potential fans can make up for a large number of other problems.

More on the Olympics

JC at Sabernomics has more on this idea that Chicago was actually close to winning the Olympic vote. He discusses the idea that there was a Chicago/Rio coalition and that one of the two was going to win. He also points to evidence in support of Chicago being close in that the futures' markets were pointing to Chicago and Rio being in a dead heat.

Could Chicago have been close to winning its Olympic bid?

Was Chicago actually fairly close to winning the vote for the 2016 Olympics? Given the discussion of Chicago finishing 4^th, only getting 18 of 94 votes, and being eliminated right off the bat, this would be very much in conflict to conventional wisdom. However, my intention in this post is to show that it is possible that Chicago could have come close to winning or even have won the final vote with just a few more votes in the first round of voting.

To look at whether Chicago may have been close to winning, first we need to look at the voting results:

City	Round 1 Votes	Round 2	Round 3
Rio	26	46	66
Madrid	28	29	32
Tokyo	22	20
Chicago	18

This implies the following revealed preferences of the voters:

Name	# of Voters	1st Choice	2nd Choice	3rd Choice	4th Choice
Rio	26	R	?	?	?
Chicago	18	C	R	?	?
Madrid	28	M	?	?	?
Tokyo	21	T	C/R	C/R/M	C/M

The Tokyo voters preferred Rio to Madrid, but it is not clear where Chicago fell in their rankings. So if Chicago could have survived the first round, even barely, the preferences of the voters are consistent with a possible comeback victory for Chicago.

The second key to victory under this scenario would have been a few voters who could have switched to Chicago in the first round, especially if they switched from Tokyo. There may be some evidence of that possibility:

Some IOC members theorized that a few voters who liked Chicago actually voted for Tokyo in the first round, figuring the American city would get through easily and not wanting the Japanese capital to be embarrassed.

Now this is all speculative, but it is at least possible. I will present four scenarios based on feasible preferences of voters. In each case I will transfer three votes from Tokyo to Chicago to begin with. I will not include any strategic voting, i.e., each voter votes for their highest remaining choice. I will also assume that all voters' preferences remain the same once the voting changes. Lastly, I will also ignore the fact that the vote totals increased after the first round.

Scenario 1: Chicago, 2^nd Choice City (Chicago Ultimately Wins)

Name	# of Voters	1st Choice	2nd Choice	3rd Choice	4th Choice
Rio	26	R	C	M	T
Chicago	21	C	R	M	T
Madrid	28	M	C	R	T
Tokyo1	15	T	C	R	M
Tokyo2	4	T	R	C	M

The original Tokyo voters are broken into two groups based on whether Chicago or Rio is their second choice. Changing the three voters from Tokyo to Chicago eliminates Tokyo in the first round (19 for Tokyo). In the second round Madrid is eliminated (C: 36, R:30, M:28). Finally Chicago ends up winning in the final round over Rio, 58-36. Chicago would beat any of the other cities head-to-head. In this scenario all that would be needed would be to survive the first round.

Scenario 2: Tokyo to Chicago, Madrid to Rio (Chicago Ultimately Wins)

Name	# of Voters	1st Choice	2nd Choice	3rd Choice	4th Choice
Rio	26	R	C	M	T
Chicago	21	C	R	M	T
Madrid	28	M	R	C	T
Tokyo	19	T	C	R	M

The scenario begins the same as Scenario 1, as Tokyo is eliminated in the first round. Under this scenario however, Rio is eliminated in round 2 (C:40, M:28, R:26) as the Tokyo voters all switch to Chicago. In the final round, Chicago wins handily 66-28 as the Rio voters vote for their second choice, Chicago. The interesting aspect of this scenario is that Rio would have beaten Chicago head-to-head, 54-40. So, Rio wins if Chicago cannot survive the first round. Chicago wins if Rio cannot survive the second round. Rio wins if they both make it to the finals.

Scenario 3: Madrid Wins

Name	# of Voters	1st Choice	2nd Choice	3rd Choice	4th Choice
Rio	26	R	M	C	T
Chicago	21	C	R	M	T
Madrid	28	M	C	R	T
Tokyo	23	T	C	R	M

Tokyo is eliminated in the first round and Rio in the second round. In this case however, the Rio voters prefer Madrid to Chicago and Madrid wins the final vote.

Scenario 4: Conventional Wisdom before Voting (Rio Ultimately Wins)

Name	# of Voters	1st Choice	2nd Choice	3rd Choice	4th Choice
Rio	26	R	C	M	T
Chicago	21	C	R	M	T
Madrid1	18	M	C	R	T
Madrid2	10	M	R	C	T
Tokyo1	9	T	C	R	M
Tokyo2	10	T	R	C	M

As in the previous three scenarios, Tokyo is eliminated first. The second round allows Chicago and Rio to advance to the finals (R:36, C:30, M:28). Finally, Rio wins the final vote, 54-40.

The key to all of the above possibilities is that they are consistent with the revealed preferences of the voters (with the exception of the three voters whose votes are changed from Tokyo to Chicago). It is also consistent with the geographical solidarity that the voters seem to exhibit.

The scenarios where Chicago ultimately succeeds are probably not the most likely, as there seems to have been a lot of sentimental support for Rio. Scenario 4 seems the most likely to me, but a variation of scenario where Chicago barely beats Rio in the final round certainly seem plausible to me.

Welcome

Welcome to my new blog. I hope this to be a place where I can post analyses at the intersection of economics and sports.