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Health

Fixing the Lottery

Cosmic VarianceBy Sean CarrollJune 28, 2007 9:07 PM

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I'm back from dinosaur hunting, no worse for wear, save for the indignities suffered upon me by Delta Airlines on the trip home. A brief report will be forthcoming. But a looming event demands our attention: tonight's NBA draft, the process by which the world's most promising young basketball talent is apportioned to the Association's various teams. A process, which, by all accounts, is in serious need of fixing. But don't worry, I have it figured out. (Hey, I was stuck in airports for over eight hours.) The basic problem is one that is common to the draft process of most professional sports leagues: the draft rewards failure. The teams that finish at the bottom of the season's standings get to choose first in the draft, funneling the best players to the worst teams. The motivation, of course, is fairness: the good teams have had their chance at success, let's give the bad ones a fighting chance. The ultimate goal is to win, so the incentive to grab a better player should be offset by the incentive to win games. In most other sports that idea basically works, but it fails drastically for basketball. The problem is that the difference in game-altering ability between the first one or two players and the next few can be huge. There are fewer players on court in hoops than in other sports, so one great player can wield a disproportionate influence. The incentive to get that very first pick can be tremendous, especially if it's between a group of teams that aren't good enough to make the playoffs anyway. As a result, a straightforward worst-pick-first draft structure leads to a race to the bottom, where bad teams intentionally lose games to have a chance to make the first pick. Repulsed by the idea that teams would purposely tank, the NBA decided to alter the incentive structure by softening the reward for losing. In 1985 the NBA instituted the Lottery: all of the teams that had missed the playoffs (seven back then, fourteen today) would be entered into a random drawing for draft position, with equal chances of getting any of the first picks. The lottery removed the incentive for finishing with the worst record in the NBA, but introduced an even worse incentive: now a team that just missed the playoffs could possibly land a franchise-caliber player if the ping-pong balls bounced their way. The last thing the Association wants is to see teams trying to not make the playoffs, so they instituted a compromise: via an ungainly formula, each non-playoff team would have a weighted chance of getting a top pick, with better chances for the teams with the worse records. This year, for example, the 14th-worse team had a 0.5% chance of getting the #1 pick. Which, of course, is the worst of all worlds! There is still some tempting incentive to miss the playoffs, but there is also incentive for non-playoff teams to lose more games. It is almost inevitable: the first pick, in the right year, can be enormously valuable, so any chance to get it will be highly sought-after, no matter how such chances are distributed. Aside from all this, there is another nagging problem with the basic idea of worst-pick-first drafts: teams can be rewarded not only because they struggled valiantly but lost with inferior talent, but also because of sheer incompetence. Good players can be steered to teams that regularly suffer from bad decision-making at the level of coaching or management. With all that in mind, here is my magic formula for fixing the NBA Lottery. (Unfortunately, I know of no way to prevent the crimes against fashion regularly committed by draft attendees.) Each year, the draft order will be chosen by the following two-step algorithm:

  • Order the teams by their record over the last two years. Break ties using this year's record.

    In one simple stroke of genius, most of the draft's problems are solved. A team's two-year record is less affected by an individual loss than its one-year record is. The incentive for tanking games is correspondingly diminished. More importantly, it's the teams that are consistently bad that really need the help, not one-year horrors. The obvious case in point is the San Antonio Spurs, who in the late 90's were a very good team, led by David Robinson, who couldn't quite get over the hump. Then Robinson was injured for most of the 96-97 season, the Spurs had the third-worst record in the league, and they won the lottery. They were able to choose Tim Duncan, with whom they have just won their fourth NBA championship. That's just wrong.

  • Teams will choose in (reverse) order of their two-year records, except that a team cannot choose in the top 3 for two consecutive years. Those that would be in the top three are bumped down until they are not.

    We want to help truly bad teams, not one-year flukes, but we don't want to reward consistent failure either. By preventing teams from choosing in the top 3 two years in a row, we let bad teams play their best basketball without feeling like they are costing the franchise a great draft pick. Note that there is no randomizing element at any step of the algorithm, but it manages to greatly reduce the incentive for bad teams to tank late-season games. Such an incentive will still exist whenever two teams are in close competition for a single once-a-decade talent, but those players have to go somewhere.

To see how this would work, here are the records of the bottom 14 teams for the combined 2005/2006 and 06/07 seasons, starting with the worst:

  1. Portland

  2. Atlanta

  3. NY Knicks

  4. Boston

  5. Charlotte

  6. Minnesota

  7. Seattle

  8. Milwaukee

  9. Memphis

  10. Philadelphia

  11. Toronto

  12. Orlando

  13. Indiana

  14. Golden State

You can see each year's records here. The three teams with the top picks in last year's lottery were Toronto, New York (which they had traded), and Charlotte. So, if we began the system this year, using the actual 05/06 draft order to determine the previous year's bottom finishers, the Knicks would get bumped down one spot, and this year's draft order would look like this:

  1. Portland

  2. Atlanta

  3. Boston

  4. NY Knicks

  5. Minnesota

  6. Charlotte

  7. Seattle

  8. Milwaukee

  9. Memphis

  10. Philadelphia

  11. Toronto

  12. Orlando

  13. Indiana

  14. Golden State

And here's how it actually will proceed under the current system, in the so-called "real world":

  1. Portland

  2. Seattle

  3. Atlanta

  4. Memphis

  5. Boston

  6. Milwaukee

  7. Minnesota

  8. Charlotte

  9. NY Knicks (traded to Chicago)

  10. Sacramento

  11. Indiana (traded to Atlanta)

  12. Philadelphia

  13. New Orleans

  14. LA Clippers

This year, the teams with the worst records were Memphis, Boston, and Milwaukee; in an unlikely turn of events, they were each bounced out of the top three picks by the vagaries of the lottery balls. Admittedly, no system is perfect, but I think mine is a substantial improvement. The present lottery system did dispense come cosmic justice by preventing Memphis from getting the first pick; they are actually a decent team, who like the Spurs ten years ago suffered an injury to their best player (Pau Gasol), and should be okay again next year without the benefit of the first pick. But the two-year rule also smoothed out their record to achieve a similar result. Portland gets the top pick either way. Atlanta, who have been pretty bad for a while, would get the second pick (in a draft where two players, Greg Oden and Kevin Durant, are rated much higher than anyone else), rather than Seattle who are actually a fairly decent team. The Knicks are a special case, as Isiah Thomas is bent on running them into the ground, and one part of his strategy is to trade away all of their draft picks, so who really cares? Most importantly, the Boston Celtics are prevented from getting one of the top two picks, despite having the second-worst record this year. That also happened in the real world, but only through a fluke. This is important because (1) everyone hates the Celtics, and (2) they were the team that most obviously tanked at the end of the season in a desperate attempt to get a better draft pick. Now, one could argue that they could have tried even harder to lose games, perhaps by having Paul Pierce kidnapped by some guys from Southie. But really, it would have been hard to tank harder than they actually did. It's too late for this year, of course, but there are future drafts waiting to be salvaged. David Stern, call me! Together, we can fix this thing.

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