Hi sports myth busters!  Rod here.

As we wind down the MLB season, it’s time for the annual deluge of “owners don’t know what they’re doing” retrospectives.

We think nothing could be further from the truth and our reasoning is in Chapter 8:  Owners and General Managers are Inept.  We address a few things that are bound to contribute to the fun, even if you disagree (and we can't imagine why you would).

Yes, Red Sox owner Harry Frazee sold Ruth’s contract to the Yankees.  Yes, the Falcons traded Favre to the Packers after only one year.  And yes, the Yankees will pay more in luxury tax this year than the entire Astros payroll.  [We dispel the Ruth and Favre stories; Maury Brown of BizOfBaseball ably handled the Astros case just recently in a rebuttal at Forbes.]

We also dispel the statistically misguided myth that somehow if the Yankees spend twice as much as another team that wins just as many games, then the Yankees must be more than twice as dumb as anybody in baseball.

So it goes like this…Oh wait… That’s why we wrote the book!  So that you would all have plenty of time and more depth on the myth than you are typically offered in the blogosphere (and surely in the Twitterverse).

So, as you catch yourself offering some variant on the following Frank Kostanza rant from Seinfeld, remember that you could have read the book and learned that ineptness had nothing to do with it.

"What the hell did you trade Jay Buhner for?  He had 30 home runs, over 100 RBIs last year!  He's got a rocket for an arm...You don't know what the hell you're doing."

Hi all.  Jason here.

One of the nice things about our 15 Sports Myths book is that the myths are pretty much self-contained and the order we present them can follow current events.  This week we jump to Chapter 13, “Owners Should Be More Vigilant in Policing Performance-Enhancing Drugs”.  The following will be familiar to those following The Sports Economist blog this week.

But Mike Trout sets the stage for us as well.  He clearly thinks everyone that gets caught with PEDs should be banned for life from MLB.  Regardless of what you think is the right punishment, Trout illustrates one point we make in Chapter 13—PED users create a cost for non-PED users, so it is surprising that the player’s union is so quick to defend PED users.  This pits one part of the union constituency against another.  If anything, PED use increases owner revenues while it is some players incurring the costs.  Maybe the focus should shift from the owners to the players if the goal is to “fix” the whole steroid thing.

In Chapter 13 we wonder why MLB owners are blamed for the whole PED enforcement problem.  After all, they were going against their economic interest by trying to facilitate extensive testing schemes.  Originally, the players union was fighting against testing despite the physical costs for users and lower relative performance for non-users. (The response was quite different in the 2011 CBA for the NFL).

We have heard a counter argument that PED users helped MLB in terms of revenues, so even non-users of PEDs were helped in terms of the share of revenues going to players in the competitive MLB pay process.  A sort of rising tide lifted all boats.  Apparently Mike Trout doesn’t think so and neither do we (see Chapter 13 for the full explanation!).

So, while he may or may not have picked the right punishment, at least Mike Trout reminds us that PED use hurts non-users.  Maybe he had other reasons for saying what he did, but it is also true that, as a non-user of PEDs, his pocketbook would be hurt if PED use increased.   The ultimate point is that he should remind his union of that.

Chapter 1. Revenue Sports Pay for Nonrevenue Sports

Hi all.  Rod here.

When we can, we'll use what we see going on right now on the web and in the twitterverse to motivate our presentation of chapters from our book, 15 Sports Myths and Why They're Wrong.  We'll do our best to respond to your posts but don't be surprised when most of our responses are, "We cover that in the chapter.  Go buy the book."

I'll kick things off with Chapter 1, "Revenue Sports Pay for Nonrevenue Sports."  From the chapter:

"It's an old adage that without the top men's revenue programs--football and basketball--there would be no athletic department.  The idea is that the AD spends any excess of revenues over costs in these sports on all of the other programs.  Ipso facto, as football and men's basketball revenue goes, so goes the economic fate of the athletic department."

This is pure myth and easily busted using the data reported by member departments to the NCAA and by individual programs to the Office of Post Secondary Education for Title IX purposes (we know, there are accounting inconsistencies, but that's what there is).  Statements are about the most recent data at the time of our writing, the 2010-11 school year.

First, how many departments actually had net revenues (after costs) for football and mens basketball?  The answer is that such is the exception rather than the rule (read the book for the precise results).  This is not opinion, but simple observation from data available to everyone.

Second, how many departments even have net deficits on the rest of their sports?  This answer is sure to surprise--at 39% of reporting departments the rest of the sports don't even run a deficit! At three of these  departments, the rest of the sports (combined) actually generate their own surpluses over $1 million!

Of the remaining, how many can cover the deficit from the rest of the sports by net men's sports revenues?  The answer is 54 departments, barely a majority of the subset we've defined--those that both have positive net football and men's basketball revenues and the rest of their sports do not at least break even.  And you might be able to guess which FBS departments dominate this list (if not, read the book).

And what about the FCS schools?  The myth takes a true and brutal beating at these departments and that is (in our opinion) some of the most fun reading in the chapter.

Of course, one of our main objectives is to point out who wins as long as this myth continues to carry the day in college sports.  The answer may surprise and (we hope) enlighten you.

Welcome to 15 Sports Myths

Welcome to our new book blog!

We hope to entice you to buy our book by sharing a bit of the content and by constantly reminding everybody (here, Twitter) when the topic turns to something we have covered here.

In addition, we'll take on some other myths that we detect in our electronic travels (Twitter).

It is our sincerest hope that you'll engage and enjoy (and buy the book).

Rod and Jason