Sunday, January 21, 2024

New ideas for the course on economics and soccer

One of the advantages of teaching about soccer and economics is that there are new things happening everyday, on the pitch, in the industry,… and in the offices and computers of researchers.

As I start a new edition of my course “Behavior and Incentives in Economics. The Case of Soccer” in the Study Abroad Program of the Autonomous University of Barcelona, I take advantage of three documents that contain new and very useful material:

-The IEB Report on Soccer and Economics published last year (which I coordinated) contains useful articles by Andrew Zimbalist on big Sports events, Thomas Peeters and Jan Van Ours on the role of managers, and Julio del Corral on the relationship between behavioral economics and Sports mechanism design (for example on penalty shoot-outs and the away goals rule). The piece on managers has a very useful example about how to compare managers that have a bad streak and are sacked in the middle of the season (like Ronald Koeman at FC Barcelona in 2021), with managers that experience a similarly bad streak and are not sacked (like Valverde in the same team a few years earlier): on average and in the particular example examined, there is not much of a difference, concluding that sacking the managers in the middle of the season does not have a causal effect on team performance.

-“Teaching Sports Economics and Using Sports to Teach Economics,” a book edited by Matheson and Fenn, is a very helpful teaching guide with very useful bibliographic references and teaching tips. I found especially useful the section on Women in sport, and advice on thinking about streaks and generating random sequences in class.

-“The Beautiful Dataset” is a new survey article by Ignacio Palacios-Huerta (author of the book “Beautiful Game Theory”) with an updated survey of mainly empirical literature on Sports, testing hypotheses from economics and related disciplines. The survey is very complete especially in those topics that Palacios-Huerta has researched himself, such as penalty kicks and referee bias. I learn from a footnote that in Hockey most penalties are not scored, meaning that if players believe that lagging behind in a penalty shoot-out places them at a significant psychological disadvantage, they should choose if they can to kick second. Meaning that if players can choose after the coin toss (as they can in soccer since the early 2000s), the order of kicking is not exogenous, which makes difficult to interpret in a causal way the results of research after that change in the rule (before the change, the order of kicking was exogenously decided by the coin, a point made by the only article I missed in the survey, by Kocher et al. -an article mentioned by Del Corral in the IEB report, that was recommended to me by Toni Ítal·lo de Moragas: thanks!).

These three documents overlap and leave gaps specific to soccer that I will try to fill in my course. The book on “Teaching Sports Economics…” is mainy about teaching and mainly uses examples from professional North American Sports leagues, although giving plenty of ideas and suggestions for soccer. Palacios-Huerta’s survey is mainly about how sports (and not only soccer) provide an ideal setting for field experiments, as the rules of contests are similar to the rules of experiments, and the protagonists are real professionals with high stakes (unlike subjects in lab experiments). Both the book and the survey have very useful material on the economics of discrimination in Sports, which is something I have been emphasizing (with a whole new chapter) in the last editions of my course. Also useful is material on managers: I learn that perhaps one can further compare managers that experience a similarly bad streak against teams of a similar quality, and not only experiences a bad streak against any team, and distinguish between sacking good and bad managers. The IEB report only digs deeper on three topics about soccer, meaning there is still a lot of work to do, for example on political economy topics, such as corruption and populism. With games every day and with researchers working at full steam, there is no shoratge of ideas to keep updating my course.

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