By John Considine
Michael Lewis has written his fair share of popular books that have economic themes. The Undoing Project: A Friendship that Changed Our Minds seems to suggest that we got a bit carried away with the potential for late 20th century economics. One could possibly say the same about his perspective on financial markets in his earlier book The Big Short: Inside the Doomsday Machine. But what about Moneyball: The Art of Winning an Unfair Game? I've read the book and seen the movie but I was never sure about it's verdict on economics.
While someone with a degree in economics might have helped the Oakland A's, the underlying message was surely not that different to The Undoing Project or The Big Short. Individual decisions, and the outcome of the decisions of many individuals, is not always perfect or efficient. If the player market was perfect then Billy Beane would not have been able to identify undervalued players.
In Moneyball we were presented with scouts who were blinded by the ways they had traditionally rated players, e.g. great wheels. It is not dissimilar to the theory-induced-blindness of "mainstream" economists in The Undoing Project. As I say, I'm not sure about the perspective on economics presented in Moneyball. There is a scene towards the end of the movie where Billy Beane (Brad Pitt) says his draft experience taught him never to make decisions based on money. Maybe Michael Lewis was never a fan of the discipline. Maybe the friendship between Amos Tversky and Daniel Kahneman was not needed to change his mind.
Moneyball did draw attention to the use of data and statistics. Scientists of all persuasions would surely approve. Plenty of other books on the use of data and statistics followed. A few have been reviewed on this blog. The Numbers Game is one of my favourites. It includes a lovely discussion on the Maldini principle. The Maldini principle is the sporting equivalent of the dog that did not bark in the night (on second thoughts I'm not sure about this as the original Conan Doyle story concerned a sporting event). In short it refers to the fact that Paolo Maldini's "numbers" did not fully reflect his defensive play. It is a warning that statistics can only capture so much.
Younger followers of football may not remember, or have even heard about, Paolo Maldini. They will know Romelu Lukaku. The Manchester United and Belgium striker has racked up an impressive array of statistics. He is among the youngest to score 50 and 100 Premier League goals. On the international scene he has outdone Messi and Ronaldo when it comes to early career goals. Of course, there are those who will question the quality of the opposition. These critics would do well to remember that there is also attacking contributions that basic count statistics do not capture. The third goal scored by Belgium against Japan in the 2018 World Cup is a case in point.
With time almost up, the score was 2-2 and Japan had a corner kick. The Belgium goalkeeper catches the corner kick. Twelve second later Belgium are 3-2 ahead. Lukaku play a huge role in the goal by (i) making a run to create space for a team mate and (ii) by stepping over the ball (see the goal here). These contributions are not always measured.
Back to Michael Lewis and Moneyball. The book plays an important role in reminding us of the importance of an empirical approach to sport and economics. There is also a little bit of satisfaction in seeing the scouts and other insiders getting a little egg on their face. But it would be wrong to throw the baby out with the bathwater. Experience at the coalface is invaluable. One can appreciate Moneyball and also appreciate more qualitative evidence. My knowledge of baseball is extremely limited but it is impossible to read baseball books by journalists like Leonard Koppett or participants like Tony La Russa without realising that understanding the game requires more than a degree in economics or statistics.
While someone with a degree in economics might have helped the Oakland A's, the underlying message was surely not that different to The Undoing Project or The Big Short. Individual decisions, and the outcome of the decisions of many individuals, is not always perfect or efficient. If the player market was perfect then Billy Beane would not have been able to identify undervalued players.
In Moneyball we were presented with scouts who were blinded by the ways they had traditionally rated players, e.g. great wheels. It is not dissimilar to the theory-induced-blindness of "mainstream" economists in The Undoing Project. As I say, I'm not sure about the perspective on economics presented in Moneyball. There is a scene towards the end of the movie where Billy Beane (Brad Pitt) says his draft experience taught him never to make decisions based on money. Maybe Michael Lewis was never a fan of the discipline. Maybe the friendship between Amos Tversky and Daniel Kahneman was not needed to change his mind.
Moneyball did draw attention to the use of data and statistics. Scientists of all persuasions would surely approve. Plenty of other books on the use of data and statistics followed. A few have been reviewed on this blog. The Numbers Game is one of my favourites. It includes a lovely discussion on the Maldini principle. The Maldini principle is the sporting equivalent of the dog that did not bark in the night (on second thoughts I'm not sure about this as the original Conan Doyle story concerned a sporting event). In short it refers to the fact that Paolo Maldini's "numbers" did not fully reflect his defensive play. It is a warning that statistics can only capture so much.
Younger followers of football may not remember, or have even heard about, Paolo Maldini. They will know Romelu Lukaku. The Manchester United and Belgium striker has racked up an impressive array of statistics. He is among the youngest to score 50 and 100 Premier League goals. On the international scene he has outdone Messi and Ronaldo when it comes to early career goals. Of course, there are those who will question the quality of the opposition. These critics would do well to remember that there is also attacking contributions that basic count statistics do not capture. The third goal scored by Belgium against Japan in the 2018 World Cup is a case in point.
With time almost up, the score was 2-2 and Japan had a corner kick. The Belgium goalkeeper catches the corner kick. Twelve second later Belgium are 3-2 ahead. Lukaku play a huge role in the goal by (i) making a run to create space for a team mate and (ii) by stepping over the ball (see the goal here). These contributions are not always measured.
Back to Michael Lewis and Moneyball. The book plays an important role in reminding us of the importance of an empirical approach to sport and economics. There is also a little bit of satisfaction in seeing the scouts and other insiders getting a little egg on their face. But it would be wrong to throw the baby out with the bathwater. Experience at the coalface is invaluable. One can appreciate Moneyball and also appreciate more qualitative evidence. My knowledge of baseball is extremely limited but it is impossible to read baseball books by journalists like Leonard Koppett or participants like Tony La Russa without realising that understanding the game requires more than a degree in economics or statistics.
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