Game Theory and the NBA

In short, Game Theory is a mathematical interpretation of a certain contextual situation. In Game Theory, the term “game” denotes a particular situation where there is a conflict with “n” being the number of individuals or groups that participate within the “game.” Also, Game Theory accounts for certain rules and restrictions within the game, as well as “moves” made by choice or chance. Finally there must be a “payoff” or outcome to the game, either a resultant of the conflict or a mutual verdict between parties. While originally adapted for economic models, the concept of Game Theory has been extended to social science, military strategy, and even professional basketball.

A common situation that involves Game Theory is the question of “why do professional athletes make so much money?” It is true that professional sports leagues like the NBA, MLB and the NFL must offer high salaries to attract the greatest talent base in the world, however one could easily justify paying an average of $100,000 as opposed to the multimillion dollar salaries given to athletes today. However, the vast majority of these athletes only specialize in a certain skill-set; therefore they are unlikely to be hired in a different profession, and they are unlikely to make a comparable amount of money in another line of work (Miller 124). Let’s now assume that the owners of these sports teams lowered the traditional monetary standards of the league, players would still make more money in the fiscally adjusted league than in any other profession. However, if one owner decided to raise wages his franchise would benefit with no doubt. The franchise would attract the best players in the league, probably win several championships and host consistent sellout audiences. Inversely, if all of the other franchises in the league decided to increase wages the isolated franchise would most certainly suffer. The team simply could not afford the top players in the league. This effect would undoubtedly lead to the majority of the losses sustained by the team. Of course, this situation does not happen because of the salary cap imposed by the National Basketball Association under Commissioner David Stern. However, the player’s union is in a constant struggle with the league, fighting for larger salaries. The NBA in turn wants to minimize salaries for many reasons, one being maximum profits for team owners, another being NBA players can stay in the league longer for financial purposes, smaller salaries induce longer careers.

Game Theory is also paramount in actual basketball play. The constantly moving nature of the sport combined with instant decision making makes the NBA a wealthy source for Game Theory research. Coined offensive schemes such as the “Triangle Offense” and the “Princeton Offense” revolve around finding an open shooter who is able to score. To equate this philosophy into practical applications there must be accepted terms. First, the likelihood of finding an open shooter increases as the number of passes within a possession increase respectively. Second, in general, relatively uncontested shots are more likely to convert than contested shots. Finally, teams with higher shooting percentages have a higher winning percentage.


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