We take a break from our finals coverage, now, to talk a little NBA draft. With my Warriors out of the playoffs, it’s pretty much all I’ve got, so…
Professor Berri of the Wages of Wins mentioned the issue of tanking the other day, which got me thinking. The NBA is unique in that teams’ order in the draft is not directly tied to their season-ending seed. Though this is meant to ensure a lack of tanking, it seems to fail quite often – most recently, with the Miami D-League All-Stars finishing up the year for Riley and company.
The tanking debate, till now, has simply focused on whether or not the assumed gains from tanking are worth the unsportsmanlike action of playing to lose (or, more charitably, not playing your hardest). Those assumed gains, however, are worth scrutinizing.
To do such analysis, I needed some data on the NBA draft lottery, which I easily found on Wikipedia. Using these probabilities, I calculated the expectation (or weighted average) of each seed’s eventual draft choice, where the #1 seed has the highest probability of winning the lottery, etc. Those results are right here:
Interesting things to note already: for the top three picks, the expected pick (EP) is worse than the seed. Everyone else comes out slighly ahead. This makes sense, since the lottery is for the first three spots only, which is proof that my number-crunching hasn’t thrown anything out of whack.
Let’s stop for a second and make some assumptions:
- The higher the pick, the better: pretty self explanatory…the first pick is better than the second is better than the third…
- Teams don’t want to lose: in other words, there is a cost to being a higher seed. Think of this as angry fans, declining revenue, whatever. To keep things simple, let’s say that the cost to jump up a seed is approximately as much as the gain from jumping up 1 in EP.
- Management has an imperfect ability to choose seeding: there are factors outside of the team’s hands (like the actions of other teams) that affect its record. As such, a lottery-bound team can’t pick its slot…it can probably control the general vicinity where it ends up, but that’s really it. For the sake of simplicity, let’s say that teams can influence their seed by 1 – Seattle, for instance, could’ve ended up either 1st or 3rd if they’d wanted.
With these assumptions in place, I’ll introduce the next bit of number crunching: Marginal Expected Pick (MEP). To find this, all I did was take each seed’s EP and subtract the EP of the next (lower) seed.
Under assumptions 1 and 3, the utility-maximizing GM of a team has a really simple question to answer: should we tank?
The answer, say the numbers, depends on your seed. If assumption 2 is accurate, the answer is yes if you’re seeds 6-14, and no if you’re seeds 1-5. In other words, once you’re in the top 5 seeds, your exact position doesn’t matter all that much. Before that, though, you do, in fact, want to tank…a result Commissioner Stern probably doesn’t want to hear, but is abundantly clear.
Which is why Pat Riley is an idiot. To lock in that .34 MEP, he basically stopped even pretending to be competitive, and probably didn’t make a utility-maximizing decision. While the NBA lottery takes a lot of heat, therefore, there’s reason to believe that dumb GMs are the problem, not the commish’s office…