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Thursday, November 06, 2008

Rules to Commish By

Posted by Jonathan Halket at 11:20am

If you’re the commissioner of your league, or you and the rest of your friends/competitors are in process of setting up a league, I urge you to pause a moment, look in the mirror, and put yourself in the shoes of a benevolent god. As this god, you will have the power to structure the rules of the world you preside over as you wish. The people in your world, your subjects, will obey your rules, but perhaps not your intentions. Instead, within the constraints of your rules, they will act to pursue their own self-interests. And remember, you’re benevolent—you’re interested in making your all of subjects happy, but each of them is only interested in himself.

Throughout the offseason, I’ll be writing about how to structure league rules so that they don’t have unintended consequences. Fantasy leagues often have a very rich set of rules on draft order, waiver-wire pick-ups, prizes for winners and so on. I believe that there are ways to improve on these rules so that many leagues would be better off.

First, though, we must talk about what makes those in your fantasy league happy. In order to make a league “better off,” we have to know what makes a league happy to begin with. Let’s just assume, for simplicity, that everyone in your league has the same tastes and preferences. Broadly speaking, then, I’d divide happiness into three not-so-sharply differentiated categories: fun, competitiveness, and verisimilitude.

Fun is made up of a bunch of things. For instance, how much time does a player have to devote to the league to be good (this could be a plus or a minus)? How social is the league? Fun is fun. ‘Nuff said for now.

Verisimilitude, or "baseballiness" as certain presidents might put it, is how much the fantasy league resembles the game we know and love. After all, there is a reason we’re playing fantasy baseball and not fantasy football, fantasy blackjack or fantasy lotto. Verisimilitude can mean different things to different people. For instance, some leagues may use stats like batting average and ERA while others may prefer “truer" measures of players’ abilities like true batting average (tBA) and true quality starts (TQA).

Competitiveness is, more or less, obvious. It measures how your league rewards skill distributed throughout the season. Two examples of uncompetitive league: Consider a league where first-place was decided by a lottery that was completely arbitrary and independent of performance throughout the season. That doesn’t sound like fun and it certainly doesn’t promote competitiveness. Next, consider a league without any free agents or trades, so that the roster you drafted is the roster you have for the whole season. Drafting may require lots of skill, but after that life would be boring.

As I said before, these components of fantasy happiness are overlapping. I’ve made a particular point of discussing verisimilitude and competitiveness, though, because I believe that league rules often sacrifice (excessively for most tastes) competitiveness for verisimilitude. Leagues often choose rules that resemble rules or stats in Major League Baseball without thinking through the consequences.

The commissioner of the MLB chooses rules to maximize the happiness of his constituents—the owners of the teams (subject to not violating anti-trust laws, etc.). Happiness of the owners is measured, despite protestations to the contrary, almost entirely in cash. A fantasy league is a zero-sum game at best; cash may exchange hands, but the league as a whole breaks even. More probably, your league pays some fees to a fantasy website to use its interface.

As an extreme example, imagine playing in a 1950s era league and suppose someone in your league suggests adding a reserve clause to the rules. Reserve clauses in baseball meant that most good free agents were signed by their former team, without any other team tendering a real offer. It meant that teams could sign players much cheaper than a free market for player salaries would have allowed. This was good for the owners, but is nonsensical for fantasy.

Using the Holds stat in scoring is a more familiar example of the potential pitfalls of excess verisimilitude in a league. Holds have been a stat in a league of mine for several seasons and, at first, it seemed to be a fun addition to the league. Identifying good setup men seemed like a skill worth adding to fantasy—it is certainly an important part of the actual game of baseball—and holds was the only way to explicitly reward that skill (middle relievers don’t pitch enough innings to help with stats like ERA or strikeouts).

As it turns out, reliable setup men are extremely thinly distributed (particularly since many of them end up closing for part of the season and cease earning holds). Rewarding holds is sort of like explicitly rewarding grand slams—you mostly end up rewarding luck, which doesn’t promote competition. In my next article, I’ll discuss a much more serious case of excessive baseballiness.


Jonathan Halket is an economist in New York. He welcomes questions and comments here.

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