NBA Players Can’t Shoot Straight after the Lockout

All the excitement generated by Jeremy Lin seems to have distracted fans from what’s really happening this NBA season.  Charles Barkley is paying attention, and he said “As a NBA fan, I want to apologize to the fans.  I cannot believe how bad the NBA is right now.” Offenses are performing poorly this season and there is a simple explanation, the lockout that delayed the start of the season and all but eliminated team practices.

This is the second NBA lockout serious enough to result in limited training camps and a shortened regular season; in 1999 the NBA played a 50-game schedule.  NBA lockouts reduce shooting accuracy and these negative effects may persist for several seasons.  Basketball productivity probably declined because pre-season practices, mid-season practices and rests days were curtailed in order to fit 66 games between Christmas and late April.

The following figure illustrates the average effective shooting percentage in NBA regular seasons from 1980, when the 3 point shot was introduced, to the current season (so fare).  The effective shooting percentage is a weighted average of 2 point and 3 point shooting percentages, where each 3 point shot receives one and a half the weight of a 2 point shot.  The figure indicates that although shooting accuracy varies from year to year, it dropped shortly after both work stoppages, and remained lower for several seasons after the 1999 lockout.

I estimated a simple regression that allows for differences in shooting accuracy among teams and correlation in the fluctuations in a team’s shooting percentage from one year to the next.  The regression model suggests that lockouts cause a 1.5% decline in the effective shooting percentage in the first season after a lockout.  The model also predicts that shooting percentages will remain lower because of the time series correlation in shooting accuracy.

The statistical model can be used to predict how the most recent lockout will reduce NBA scoring over the next few seasons.   Combined scoring by both teams is expected to drop by 5.5 points in 2012 and 3.3 points in 2013 due to the reduction in shooting accuracy.

NBA coaches and teams can adjust strategies to mitigate the impact of the prolonged lockout.  For example teams can attempt more (or fewer) 3 point shots and slow down (or speed up) the pace of play.  If these adjustments are made scoring reductions could be somewhat smaller than the model’s predictions.

Some fans believe that the NBA’s 82-game regular season is too long, so that a silver lining of the 2011 lockout is a shortened 66-game schedule.  Whether or not the regular season is too long, compressing a 66 game season into four months has a negative impact on offensive efficiency.  Practices and rest days are important, even for the world’s best athletes competing at the highest level.  The elimination of rest days and practices appears to be relatively more important for basketball offenses.

Sugar Beets and Lockouts

Yesterday’s New York Times describes how lockouts have become a more common tool in labor management negotiations. Management is more likely than ever to lockout union workers, hire replacement workers and pressure unions to accept wage and benefit concessions when contract re-negotiations become deadlocked.

The Times article focuses on American Crystal Sugar, the nation’s largest sugar beet processor, which is currently involved in a lockout with 1300 union workers employed at five plants. The article never mentions that profits and union compensation in the sugar beet industry rely on import tariffs, quotas on imported sugar, and protection from foreign competition.

It is simply cheaper and more efficient to import sugar than it is to process sugar from sugar beets in the US. As Mark Perry noted in his Carpe Diem blog two years ago, government intervention in the market for imported sugar has protected the sugar beet industry and raised the price of sugar for the American consumer. The sugar beet industry has received $242 million in subsidies over the past 15 years.  More importantly, as Perry explains, our policies have caused U.S. sugar prices to be about twice the world price for decades. In 2009 alone this cost consumers $2.5 billion dollars.

Remarkably, the topic of sugar subsidies was raised yesterday at the Republican debate. Newt Gingrich admitted that in all of his years in the House he was unable to eliminate sugar subsidies. His simple explanation for the durability of this anti-competitive policy was there are “just too many beet sugar districts in the United States.” This debate topic released a torrent of cynical (but funny) tweets . The consensus was: this is silly, aren’t there more important issues?

The story of sugar beets is a lesson in why inefficient government programs are difficult to eliminate. Every policy has winners and losers. The winners are the sugar beet processors and organized labor who are currently deadlocked over how to split the profits from operating in a market protected from foreign competition. The losers are American consumers. Unfortunately the stakes are so low per consumer, $8 per year, that we think it’s silly to question candidates about how they expect to change Washington if they can’t stop subsidizing and protecting sugar beets.

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