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The dilemma of choosing talent: Michael Jordans are hard to find

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  • Peter Groothuis
  • James Richard Hill
  • Timothy Perri

Abstract

This article explores the dilemma of choosing talent using NBA data from 1987 to 2003. We find there is much uncertainty in selecting talent. If superstars are found, they are usually identified early. However, more false positives exist than correct decisions with high draft picks. Our results suggest the dilemma of choosing talent is not so much a winner's curse but more like a purchase of a lottery ticket. Most times you lose, but, if you are going to win, you must buy a ticket.

Suggested Citation

  • Peter Groothuis & James Richard Hill & Timothy Perri, 2009. "The dilemma of choosing talent: Michael Jordans are hard to find," Applied Economics, Taylor & Francis Journals, vol. 41(25), pages 3193-3198.
    • Handle: RePEc:taf:applec:v:41:y:2009:i:25:p:3193-3198
    DOI: 10.1080/00036840701564459
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    References listed on IDEAS

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    1. Lynne M. Pepall & Daniel J. Richards, 2001. "Reach for the Stars: A Strategic Bidding Game," Economica, London School of Economics and Political Science, vol. 68(272), pages 489-504, November.
    2. Peter Groothuis & Richard Hill & Timothy Perri, 2004. "Early Entry in the NBA Draft: The Influence of Unraveling, Human Capital and Option Value," Working Papers 04-05, Department of Economics, Appalachian State University, revised 2005.
    3. Rosen, Sherwin, 1981. "The Economics of Superstars," American Economic Review, American Economic Association, vol. 71(5), pages 845-858, December.
    4. T. S. Breusch & A. R. Pagan, 1980. "The Lagrange Multiplier Test and its Applications to Model Specification in Econometrics," The Review of Economic Studies, Review of Economic Studies Ltd, vol. 47(1), pages 239-253.
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    Cited by:

    1. Benjamin J Gogos & Paul Larkin & Jade A Z Haycraft & Neil French Collier & Sam Robertson, 2020. "Combine performance, draft position and playing position are poor predictors of player career outcomes in the Australian Football League," PLOS ONE, Public Library of Science, vol. 15(6), pages 1-15, June.
    2. Ariga, Kenn & Brunello, Giorgio & Iwahashi, Roki & Rocco, Lorenzo, 2008. "The Stairways to Heaven: A Model of Career Choice in Sports and Games, with an Application to Chess," IZA Discussion Papers 3327, Institute of Labor Economics (IZA).
    3. Martina Gianecchini & Alberto Alvisi, 2015. "Late career of superstar soccer players: win, play, or gain?," "Marco Fanno" Working Papers 0192, Dipartimento di Scienze Economiche "Marco Fanno".
    4. Dennis Coates & Babatunde Oguntimein, 2010. "The Length and Success of NBA Careers: Does College Production Predict Professional Outcomes?," International Journal of Sport Finance, Fitness Information Technology, vol. 5(1), pages 4-26, February.
    5. Timothy Perri, 2012. "Between the penthouse and the outhouse: the sorting of economics professors," Applied Economics Letters, Taylor & Francis Journals, vol. 19(18), pages 1899-1902, December.
    6. Javier García-Rubio & Daniel Carreras & Sebastian Feu & Antonio Antunez & Sergio J. Ibáñez, 2020. "Citius, Altius, Fortius; Is It Enough to Achieve Success in Basketball?," IJERPH, MDPI, vol. 17(20), pages 1-10, October.
    7. Ozmen M. Utku, 2012. "Foreign Player Quota, Experience and Efficiency of Basketball Players," Journal of Quantitative Analysis in Sports, De Gruyter, vol. 8(1), pages 1-18, March.
    8. Ryan M. Rodenberg & Jun Woo Kim, 2011. "Precocity and labor market outcomes: Evidence from professional basketball," Economics Bulletin, AccessEcon, vol. 31(3), pages 2185-2190.
    9. James Richard Hill & Peter A. Groothuis, 2015. "Are Findings of Salary Discrimination Against Foreign-Born Players in the NBA Robust?," Working Papers 15-13, Department of Economics, Appalachian State University, revised 2015.
    10. Rodenberg Ryan & Kim Jun Woo, 2012. "Testing the On-Court Efficacy of the NBA's Age Eligibility Rule," Journal of Quantitative Analysis in Sports, De Gruyter, vol. 8(2), pages 1-23, June.
    11. James Richard Hill & Peter A. Groothuis, 2016. "Is There a Wage Premium or Wage Discrimination For Foreign-Born Players in the NBA?," Working Papers 16-11, Department of Economics, Appalachian State University.

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