By Robbie Butler

In the context of European sports, one of the defining characteristics that generally makes it stand out from American sports is the "open" nature of competition. This is more simply known as promotion and relegation. European football, rugby, cricket, and other fields sports punish weaker teams at the end of each season and force them to play in lower tiers of competition.

This is not true of sport in much of the United States. The systems are closed. The NFL, MBL, NBA and even domestic soccer's MLS, all have no relegation mechanism. The opposite occurs in fact. The weakest teams get earlier draft picks, meaning that US sports are typically more balanced than the laissez faire European leagues. The US leagues are generally controlled and managed by the owners of the franchises. In Europe, the clubs are almost always answerable to a different and 'independent' body that administers the competitions they compete in.

In 1888 the Football League was founded. It was in essence a break-away but up to that point fixtures were generally arbitrary. The twelve founding members competed until January 1889. The 4 bottom teams were not relegated but the concept was there - all 4 successfully sought to be re-elected to the league. Therefore, the idea of relegation has been within the Football League - the first football league anywhere in the world - since it's inception. 

In 1992 another break-away league started in England - The Premier League. This was an innovation inspired by sports across the Atlantic. There was opposition at the time to the creation of the Premier League. The movement of all games to subscription television was one of the most contentious issues. 30 years on this decision has revolutionised the game. It has turned small English cities and towns into globally recognised places. Stoke, Burnley, Norwich, Bournemouth, Brighton. The list goes on. 

The announcement of the next break-away league involving English clubs - the European Super League - is nothing new. There are however a number of key difference between this and both 1888 and 1992.

The first is the competition structure and removal of relegation. Such a move would be an Americanisation of European football and a major departure from the accepted norm.

The second is the step outside the national boundary. While European competition has existed since the 1950s, qualification to this was through the domestic leagues. The new Super League would eliminate the need for this. 

The third strikes at the monopsony power of UEFA. While a monopoly is a single seller of a product (something many of us are familiar with) monopsony is a single buyer. As a result the monopsony essentially controls the market as it is the sole purchaser of the goods or services that potential sellers wish to bring to market. This market power can be wielded in order to control the market.

While the major US sports such as NFL, MBL and NBA are better examples of monopsony power, UEFA holds this in a European context. Should one wish to play professional football or operate a football club, UEFA is the sole buyer of this service. It therefore holds monopsony power over the market for European football.

A European Super League would end this, and create a new dynamic in the market. The clubs would be self-governed within this new league and would make the structure resemble something much closer to the American model rather than the European system.

UEFA are not lying down. A ban on playing in all UEFA and FIFA competitions (e.g. the FIFA World Cup) is now the penalty for playing in the new Super League. 

This has a long way to run. Supporters are notoriously conservative when it comes to changing aspects of the game that have deep historical roots. Even largely superficial changes to colours or names have been vigorously rejected by supporters. Moving location - another regular happening in the US - is met with fierce opposition in Europe. Completely upending between 60 and 130 years of competition structure (depending on where you want to draw the line) will be far from straightforward, if even possible at all.

By John Considine

A recent paper in the BMJ Open Sport and Exercise Medicine gathers a range of evidence that seems to confirm the obvious - the risk of Covid-19 transmission in golf is low.  It is hard to imagine a sport more suited to our current circumstances.  It is a non-contact sport. It is played outdoors on 5km-7km greenways.  At most 150 players are spread across this distance.  Individuals are socially distanced at ranges from the arc of the golf swing to the flight of the golf ball.  In many cases, the only shared equipment are flag sticks and bunker rakes (although the latter have been removed in many cases).  Even here the risks are low according to the BMJ paper.  The authors (Robinson, Foster, and Murray) cite other work that showed "only 0.74% of COVID-19 virus was recoverable at 1 min in high inoculum when applied to a variety of sports equipment (including a golf ball)".

There should be few problems with reopening the sport but the wider golf economy may take a while longer to recover.  Estimates of consumption expenditure on golf were produced a couple of years ago in a commissioned report.  Some are reproduced in Table 4.1 below.  Many of the items that contribute to the overall total continue to suffer due to the pandemic.  The €46m generated from "Food and Beverages" is unlikely to return to these levels anytime soon.  A similar point could be made about the fourth, fifth, and sixth items in Table 4.1.  These will be hit by the problems associated with international travel.

It is worth drilling down into the €38m figure for Green Fees.  It seems pretty low when you consider that there is approximately 400 golf course on the island of Ireland.   With a green fee of €50 it approximates to about 6 rounds per course per day.  Not a lot.  It leaves plenty of tee-times for the members.  However, that is not the full story.  The distribution of revenues from Green Fees is skewed towards some of the more iconic courses.  A prime example is Lahinch.  It held the Irish Open in 2019 when Jon Rahm proved best of the bunch.  It was expecting revenues of approximately €2m in 2020.  Other courses that have held the Irish Open and Ryder Cup are also favourites of the golfing tourists.  They were expecting Green Fee revenues measured in the millions.  A small number of these courses capture a large proportion of the €38m in Green Fees.  Much of it from international tourists.

Many of these iconic courses have associated accommodation.  The €37m figure for Accommodation in Table 4.1 will not accrue in 2021.  Only when international travel returns to something like normal will these revenues be recovered.  In the short-term even the Irish are not free to play whatever course they wish due to national travel restrictions.  It is a tough time for a sport that poses a small Covid-19 health risk.

By David Butler

It’s hard to be a fan of VAR with its many quirks. At times it is as if the lines are drawn with MS paint.

As fans and pundits rage online on a weekly basis over VAR calls, one part of me does have sympathy for those administrating VAR. Our eyes can deceive us. When we think a player is onside, in fact they may not be. Visual illusions are a mainstay of introductions to behavioural economics – they usually set things up nicely for discussing information-based biases – it follows that if you can’t trust your eyes what else can’t you trust?  

Unsurprisingly, Daniel Kahenman offers a nice insight in Thinking Fast and Slow when discussing the famous Müller-Lyer illusion inset.

“You know that the lines are equally long. If asked about their length, you will say what you know. But you still see the [middle] line as longer. You have chosen to believe the measurement, but you cannot prevent System 1 from doing its thing; you cannot decide to see the lines as equal, although you know they are. To resist the illusion, there is only one thing you can do: you must learn to mistrust your impressions of the length of lines when fins are attached to them. To implement that rule, you must be able to recognize the illusory pattern and recall what you know about it. If you can do this, you will never again be fooled by the Müller-Lyer illusion. But you will still see one line as longer than the other.”

​Is it time to start trusting the technology? As we are often reminded on TV, us viewers only see one angle. Or at least, should we start recognising that our perceptions might be fallible?  

Accepting our intuition failures might be easy for the Müller-Lyer paradox, but this is harder for sport. Fans have clear allegiances and are emotionally engaged. System 2 has to work even harder! 

By Robbie Butler

Almost 5 years about I wrote a piece on this blog called "The Difficult Job of Management". The piece plotted the relationship through time between the appointment of each Premier League manager (more than 240 different men) and the number of days in charge.

From 2006 to 2016 the average length of stay for a Premier League manager was just over 400 days. Two weeks ago Liverpool's Jurgen Klopp broke the 2,000-days barrier. One year earlier, now departed Spurs manager Mauricio Pochettino, just about managed the same feat only to be sacked on day 2,002. Both managers, particularly Klopp who could reach 3,000 days in charge (maybe further), very much buck the trend today. One has to go back to 2006 (Mick McCarthy at Wolves) to find a manager than lasted 2,000 or more days since appointment.

And despite, regular periods where his appointment has been question, Ole Gunnar Solskjær is now just 84 days shy of Jose Mourinho's 927 days at Manchester United. Should he reach 928 days, he will be the longest serving United manager since Sir Alex. I think all would agree the chances of Ole reaching Sir Alex's 9,704 days in charge are effectively zero. The game has changed too much since 1986.

And speaking of 1986, and Sir Alex's appointment, the Scot went 1,288 days from his appointment as United manager to the FA Cup replay win over Crystal Palace at Wembley in May 1990. Should United not win the Europa League this season, Ole will be in Ferguson territory (1000+ days) as he searches for his first piece of silverware. Quite remarkable in today's game when most managers get 400 days or less.

"By Robbie Butler

We were delighted to learn last week of the acceptance of our paper "The Evolution of the Football Jersey - An Institutional Perspective" in the Journal of Institutional Economics. 

This paper explores the interaction of informal constraints on human behaviour by examining the evolution of English football jerseys. The jersey provides an excellent setting to demonstrate how informal constraints emerge from formal rules and shape human behaviour. Customs, approved norms and habits are all observed in this setting.

The commercialisation of football in recent decades has resulted in these informal constraints, in many cases dating back over a century, co-existing with branding, goodwill and identity effects. Combined these motivate clubs to maintain the status quo. As a result, club colours have remained remarkably resilient within a frequently changing landscape.

​The paper is currently going through the production process but should be available online in the coming weeks, and will appear later in the year in the journal.

By John Considine

Richard Thaler devotes Chapter 29 of Misbehaving: The Making of Behavioral Economics to (American) Football.  Most of the chapter is devoted to illustrating how early round draft picks subsequently underperform and/or are overcompensated.  Thaler is also critical of giving away future draft picks.  It is part of Thaler’s case against presumptions about the efficiency of decision making.
 
I was reminded of Thaler’s work by developments in recent weeks.  The trade that exchanged Jared Goff for Matthew Stafford involved the Rams giving up draft picks.  Does this illustrate the benefits from trade or the pull of instant gratification?  It should be noted that some commentators suggest that giving up first round draft picks can help teams avoid criticism like the Bears got for their drafting of Mitchell Trubisky before Patrick Mahomes and Deshaun Watson.
 
Thaler’s work draws attention to decision making errors.  One could argue that he was forced to over emphasise this aspect to get a hearing in economics where the default is to assume that human decision making is correct (or self-correcting).  Again, recent developments are worth considering.  Dak Prescott’s new deal with the Cowboys can be interpreted in a variety of ways.  Some suggest he is now being overcompensated because he was undercompensated previously.  A sort of market correction.  Others suggest that Jerry Jones made an error by not doing a deal with Dak earlier.
 
Dak himself spun a different story.  Dak saw his new deal as helping other players by raising the bar for all players looking to negotiate a new deal.  He has a point.  But he may damage his team’s ability to hire - especially in a year where the salary cap is coming down.  Some might say that Dak is not making the “rational choice” that Tom Brady has previously made.  In The Importance of Small Decisions Brady’s structuring of his deals in New England was presented as being aligned with the economist’s idea of rational choice (here is a previous blog on this point).  I wonder if that example overplays the success of Brady’s decision making in a way that Thaler may overplay the errors in the draft.

If The Importance of Small Decisions makes it to a second edition then I guess that Brady’s decision to move to Tampa will be included.  Another ring followed that decision.  (How might it view Brady's decision to engage in practice with teammates that possible broke coronavirus restrictions?)

Few economists claim that the rational choice model explains every aspect of decision making.  Most think it is a very useful framework.  If it explained all choices then why would we have to include the "rational" part.  Rational choice was one of four quadrants in The Importance of Small Decisions.  Thaler tends to place it within one of two systems of decision making.  These two systems are roughly captured by the title of a book by Daniel Kahneman - Thinking, Fast and Slow.  These systems are also present in Thaler's co-authored Nudge: Improving Decisions About Health, Wealth, and Happiness.  In these publications, one system is slow, conscious, and deliberative (not inconsistent with rational choice).  The other system is fast, intuitive, and automatic.  Many decision making errors are attributed to this second system.  Kahneman allows that experts make less of these errors but he is careful to circumscribe the circumstances where this applies (see here).  The default emphasis of Thaler and Kahneman is on the errors in human decision making.

The Importance of Small Decisions uses Tom Brady as the poster boy for rational choice.  I have not come across Kahneman or Thaler using Tom Brady to illustrate to successes of human decision making.  It is hard to imagine.  One of Thaler's favourite characters is Homer Simpson (he complains that rational choice uses characters like Star Trek's Mr Spock).  We need to look outside of economics to find Brady playing a similar role for fast, intuitive, automatic decision making.  In Game Changer: The Art of Sports Science Fergus Connolly takes four pages to describe 2.3 seconds of Tom Brady’s decision making in a Super Bowl.  Four pages for 2.3 seconds.  Connolly is slow and deliberative in describing a decision making process that is fast and instinctive.  Connolly talks about inputs being transformed into actions in “auto pilot mode” and without some of the inputs making it “all the way to his brain”.  An expert decision maker in action.

When it comes to decision making in economics, and in sport, too often we over emphasise either the successes or failures of decision making.  It is the mixture that makes it interesting.

By David Butler

Almost a year ago, I wrote about Ireland’s ELO rating* since June 1988 and Stephen Kenny’s job to reverse the slowly declining trend. The opposite has occurred since last March. The loss to Luxembourg last weekend meant that the senior team recorded their lowest ELO rank in over thirty years. 

*the ELO rating system is adapted from chess and scores soccer teams based on performance. Among a range of factors, points are awarded based on the type of match played (qualifier/friendly etc.), home advantage, opponent quality, goal difference and expected results. 

By Robbie Butler

One year is a long time in football. The last year has felt like the longest ever. As the Republic of Ireland go in search of their first win under Stephen Kenny (in their 11th game of asking), it seems a long time ago since the team's last win - November 2019 versus New Zealand under Mick McCarthy..

There are undoubtedly a combination of factors that have made the past twelve months extremely challenging. Empty stadiums, travel restrictions, Covid withdraws, the list goes on. For me, the most worrying aspect of the team's performances is the contrast between McCarthy's second reign and that of the current manager. 

McCarthy's second spell in charge lasted 10 games, the same as Kenny to this point. He's record W5 D4 L1 GD+6. This includes competitive and friendly games but would result in 19 points under normal circumstances. In fact, this record is bettered by only one of the last 10 Irish managers (back to John Giles) for the first 10 games - Brian Kerr (21 points).

Of course, the counter argument to this is that the new manager is attempting something revolutionary and changing the "way we play". I have moved to John Maynard Keynes school of thought when those in favour of this now argue it is a long run project. "In the long run, we are all dead".

By David Butler
​
Now that the dust has settled on the Cheltenham Festival 2021, we can reflect on the performance of the tipsters last week. The chart below shows the performance (profit/loss) of the traditional newspapers and recognised online tipping sources who made regular predictions.

Non-runner predictions were excluded and a hypothetical stake of €10 (€5 each-way) was placed on the starting price of each horse predicted to win.

If a punter was to follow the tips from the Scottish newspaper The Daily Record they would have returned a profit of €305.44 over the four days. This profit was driven by their excellent performance on Wednesday and Thursday (in particular, tipping Put the Kettle On at 17/2, Sky Pirate at 14/1 and Flooring Porter at 12/1). The Sun finished second - with profits heavily reliant on tipping Belfast Banter at 33/1.

Five of the tipsters made profits on both win and each-way bets. From the tips offered on horseracing.net only Spotlight made both win (€181.47) and each-way profits (€123.86).

By Robbie Butler

The Football Association of Ireland are currently seeking to recruit a Insights/Research Manager. 

The Insights Manager would be primarily responsible for collecting, researching and interpreting data, and articulating insights that drive the Association's objectives. 

The successful candidate will be expected to provide research and insights support across the Commercial Partnerships, Sales and Ticket Operations and will play a crucial role in measuring and valuing our sponsorships.

Closing date for receipt of applications is close of business on 16/04/2021.

​Further details on this position can be found here.