Basketball

Hoop Schemes

By now, both the NCAA and NBA seasons have played themselves out. But as many analysts and coaches are quick to point out, the real work on your basketball game happens in the summer, the off-season. Anecdotally, much of what is said during the play-by-play, color commentary, halftime discussion, and post-game breakdown rings strikingly similar to fundamental economics principles.

Two economics principles that form the foundation of economics are incentives and efficiency. It’s even been argued, in somewhat of a reductive sense, that the whole of behavioral economics comes down to the idea:

People don’t do what you tell them to do. People don’t do what you want them to do. People do what you incent them to do.

One of the beautiful things about this assertion is that is completely bi-passes the moral argument. In economics, there are right answers, and they are wholly independent of judgment about ethics.

Alignment of Incentives

Incentives are the motivation to take a particular action. Disincentives are the motivation to not take a particular action.

The notion that five individuals can play for the betterment of the collective basketball team is paradoxical to those beginning to learn the game. Scoring is the most rewarding for the individual who makes the basket in terms of glory, but ultimately the number of baskets for the entire team is used to substantively determine whether the outcome of the game is a win or a loss. The “best” player on a team is typically considered the one who scores the most, and on and on down the food chain. The fact of the matter is that value is created by not only scoring, but also creating opportunities for your teammates to score, gaining possessions through rebounds, steals and minimizing turnovers. Defensive statistics are somewhat more nebulous and by their nature more difficult to measure.

Agency is a concept that can help to explain the seeming paradox between the glory of individual scoring and the hardly altruistic glory of team scoring. If interests are aligned, the five players on the court use the movement of the ball and the players on the court to score more points for the collective. Alternately, if there’s a misalignment with team and individual goals, more often than not a player is perceived to be taking too many shots, especially of the variety that aren’t relatively “good looks”. An agency problem is defined when the interests of the individual are put in front of the collective. In the business world, it’s the equivalent of taking office supplies for one’s personal use. All too commonly, in corporations the existence of agency problems are do to insufficient internal controls. On the basketball court, monitoring of the collective teams good is more visible, and a lack of internal controls is largely attributed to be a result of poor coaching.

While the individual and team incentives vary, there are situations where they are aligned. In these instances, the team scoring is evenly balanced, the movement of both the players and the ball are mutually beneficial, and team defense is greater than the individual efforts of the five different players. In economic terms, this last characteristic is known as synergy. When the collective efforts systemically contribute in ways that individuals alone just can’t, a basketball team approaches their highest levels of effectiveness on both sides of the ball.

With the Ball

When a player with the ball first retains possession, common wisdom is to take the position of “triple threat”. The ball is held roughly at chest height at a staging point where the player can A. Dribble, B. Pass, or C. Shoot. The triple threat position is a near facsimile of the financial instrument referred intuitively as options. In finance, an option is the opportunity to buy (a call option) or sell (a put option) a security at a specified price (the strike price) at a specified date in the future (the expiration date).

Just owning an option is valuable, at least until it expires. Likewise, when the basketball player is holding the ball in triple threat position within his shooting range and ability to drive to the basket, the defender is in a bit of a quandary. He can choose to defend any of the the three potential actions of the player with the ball, but it involves a bit of guesswork, some degree of luck, his knowledge of the opposing players skills, and a lot of skill adapting to the offensive player’s cues and actions.

Dribbling the basketball is one option that in most aspects extends the option's expiration date, because the player can dribble to a better position (or in place) and then choose the equivalent of a call option by passing or shooting the ball. Alternately, the player could dribble off his foot out of bounds, have his pocket picked, or throw an errant pass and transform it into an option of the put variety.

Having the ability to dribble both right and left forces the defender to play the offensive player “straight up”. In other words, they can’t cheat one way or the other, or force the offensive player to use his weak hand to effectively protect the basketball. The ability to dribble effectively with either hand is an admirable trait, and one that happens to be especially close to the heart of the Ambidextrous Economist.

The skills and the associated practice time that a player chooses to put into his ball handling may not benefit the team in terms of points, but it definitely improves the player’s value, if not in nominal terms, then at least by what’s visible in relative statistics such as the assist to turnover ratio. If a player has a positive assist to turnover ratio, that means their passes are directly leading into scores more than they’re giving the ball up to the other team.

The greater the shooting range (the distance that a player can reliably hit jump shots), the more credible threat that player presents, and the more difficult that player is to defend. Since the defender needs to play them that much closer, the less effectively that defender is able to sag off the offensive player to help on other players or position himself to close out passing lanes or gain strong rebounding real estate.

Off the Ball

When a teammate has the ball, the individual offensive player’s game is mostly of positioning. He can pick for the man with the ball, screen for another player off the ball, or try to get open himself (either to set up a shot or make a pass). Collectively, though, the more the ball moves, the harder the defense has to work, regardless of the defense scheme.

The one thing coaches try to instill at every level of the game when the player is off the ball is to keep moving. Standing in one place is easy to defend because it reduces the optionality of both the player holding the ball and the player letting grass grow underneath him.

Defensively, the best thing a player can do is make life difficult for the player he's assigned or in the zone he's assigned. If he's right handed, make him use his weak hand by cheating to the right. Deny him the ball when he's in shooting range. Call out the picks he's making so you're teammate knows they're coming. Step over or slide under screens. Do all the things you hate when a defender does it to you. Make him work just to dribble up the court.

Basketball is a game of possessions, and there's no way to overemphasize the need for rebounds. Offensively and defensively, when a shot goes up, block out your man and get to the boards. When you win the rebounding game, you get more shots at your end of the court and deny second shots to your opponent. If we can understand games in terms of statistics, then rebounds are arguably the most important way to shift the odds to your team's favor.

Economics in Everything

The preceding analysis is not intended to be all inclusive, but it is intended to show a bite-sized example of the widespread applicability of economics. Little by little, each article in Ambidextrous Economics is intended to illustrate how the field of economics can lead to greater insight into real world applications. The more familiar you become with the part economic analysis plays into just about everything, the better off you’ll fare breaking down difficult problems into manageable pieces.

AE - 06.30.2011

The Ambidextrous Economist is a baller. He can be reached at AmbidextrousEconomist@gmail.com.