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Freakonomics Can't Jump?

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Is Malcolm Gladwell a “freakonomist?” A freakonomist might be defined an economics writer who has the ability to transform contrarian arguments into conventional wisdom almost overnight. Steven Levitt and Stephen Dubner, for instance, created a popular consensus that abortion cuts crime. Unfortunately, the trip from contrarianism to consensus is often a result of psychology rather than the merits of the arguments. We like contrarianism because contrarianism is, well, kinda cool.
Fortunately, we have Steve Sailer around to deliver sharp reality checks against these freakonomics claims. Way back in 1999 he pointed out that abortion didn’t actually cut any crime in the first cohort of young men from whom legalized abortion supposedly culled the worst criminals. Serious crimes actually went up among this group. Most recently Sailer’s aimed his reality guns at Malcolm Gladwell’s New Yorker article touting a book by a couple of economists who argue that, among other things, that far from being the top NBA player in the season he won the Most Valuable Player award, Allen Iverson was only the ninety-first-best-play in the league.

Here’s how Gladwell describes “The Wages of Wins” by economists David J. Berri, Martin B. Schmidt, and Stacey L.

Weighing the relative value of fouls, rebounds, shots taken, turnovers, and the like, they’ve created an algorithm that, they argue, comes closer than any previous statistical measure to capturing the true value of a basketball player. The algorithm yields what they call a Win Score, because it expresses a player’s worth as the number of wins that his contributions bring to his team.

Since this is a New Yorker article, Gladwell doesn’t actually explain how this algorithm works. New Yorker readers don’t actually need to know how the things they know work; it’s enough to know that some smart says they do.
Sailer finds a 1999 paper in which one of the the authors describes how to derive the Win Score. It works like this:

Points + Rebounds + Steals + 1⁄2Assists + 1⁄2Blocked Shots
–Field Goal Attempts – Turnovers - 1⁄2Free Throw Attempts - 1⁄2Personal Fouls

Extra points if you can see what positive element gets overweighted in this analysis. That’s right, it’s rebounds. As Sailer points out, every other positive element gets balanced against the cost of earning it. Points, for example, gets balanced against field goal attempts. Rebounds gets nothing, meaning that big time rebounders get overrated by the Win Score.
So back to Gladwell, who concludes his article with this graph:

It’s hard not to wonder, after reading “The Wages of Wins,” about the other instances in which we defer to the evaluations of experts. Boards of directors vote to pay C.E.O.s tens of millions of dollars, ostensibly because they believe—on the basis of what they have learned over the years by watching other C.E.O.s—that they are worth it. But so what? We see Allen Iverson, over and over again, charge toward the basket, twisting and turning and writhing through a thicket of arms and legs of much taller and heavier men—and all we learn is to appreciate twisting and turning and writhing. We become dance critics, blind to Iverson’s dismal shooting percentage and his excessive turnovers, blind to the reality that the Philadelphia 76ers would be better off without him. “One can play basketball,” the authors conclude. “One can watch basketball. One can both play and watch basketball for a thousand years. If you do not systematically track what the players do, and then uncover the statistical relationship between these actions and wins, you will never know why teams win and why they lose.”

Well, maybe. But one can also derive plausible algorithms that supposedly uncover statistical relationships that seriously underrate what teams need to actually win games. Think about it this way: could you use the wages of win to actually, well, wager on which teams will win games? Are the authors doing this?
We’re reminded of the advice one of our old mentors: “Don’t trust anyone with a theory who doesn’t have his own money riding on the thing.”
Game Theory [New Yorker]
Who is ‘Most Valuable’? Measuring the Player’s Production of Wins in the National Basketball Association [pdf] [Managerial and Decision Economics]
Malcolm Gladwell: Everything you know about the NBA is wrong [isteve .com]