Opinion: The economics of “doing what’s best for the player”

Update: The Spurs lost this game and currently are down 0-3 in this series. Check back for analysis and opinion pieces tomorrow.

It has been announced today that Kawhi Leonard will be out for tonight’s Game 3 at home against the Golden State Warriors.

ESPN has been reporting that there is a “do what’s best for the player” philosophy that has been in place with the Spurs since 2000.

To say I disagree with this decision (and this philosophy) is a huge understatement. Here’s why.

Heading into this game, the Spurs are down two games against the Warriors. The marginal (definition: incremental; additional) cost of losing this game is much, much higher than the marginal benefit of winning this game. Winning this game would mean the Spurs would be down only one game with a record of GSW 2 – SA 1. However, losing this game would mean the Spurs would be down three games with a record of GSW 3 – SA 0. With such a record, it would look highly likely that the Spurs would get swept by the Warriors.

To be fair, there are certainly marginal costs and benefits associated with deciding whether Kawhi should play or not. I don’t know the probability of Kawhi re-injuring his ankle, so I can’t say how high (or low) the marginal cost of him playing in the game is. But I can certainly tell you how high the opportunity¬†cost (definition: next best opportunities that are given up) of Kawhi not playing tonight is. The opportunity cost of Kawhi not playing tonight is equal to the marginal benefit of Kawhi playing tonight (aka a sure win for the Spurs, which means this is a huge lost opportunity).

With Coach Pop, I think this is all a matter of being more risk-averse than loss-averse. Because the probability of Kawhi re-injuring his ankle is not clearly defined, that would’ve made him suiting up to play in tonight’s game a huge risk. However, having Kawhi sit out tonight’s game will likely lead to yet another win by the Warriors.

Yet, the Spurs’ apparent lack of loss aversion defies conventional thinking in behavioral economics. In Chapter 26 of Thinking, Fast and Slow, Dr. Daniel Kahneman presents the following ideas:

  • In mixed gambles, where both a gain and a loss are possible, loss aversion causes extremely risk-averse choices.
  • In bad choices, where a sure loss is compared to a larger loss that is merely probable, diminishing sensitivity causes risk seeking.

I don’t think Pop sees it this way, but I believe he faced a decision with two bad choices. The first choice is obviously a “sure loss” for the Spurs facing the Warriors without Kawhi Leonard, given how these last two games have gone. The second choice is a “merely probable” but potentially larger loss in Kawhi Leonard possibly re-injuring his ankle again if he were to have played tonight. So, what’s the deal with this risk-averse attitude?

If the Spurs go on to get swept by the Warriors, all because of concerns about Kawhi’s long-term health, this would be grounds for firing Pop if this were any other team. I feel confident in saying that most behavioral economists would believe that Pop should be fired in the event of a Warriors sweep.

Now, I personally have far too much respect for Pop to have the opinion that he should be fired if the Spurs get swept in this series. Every year that he’s been the coach of the Spurs, this team has made the playoffs. The Spurs have won championships in three different decades: the 1990’s, the 2000’s, and this decade. He certainly is one of the greatest coaches of all time.

But perhaps it’s time for the “do what’s best for the player” philosophy to be changed to “do what’s best for the team, including the player, and the fans.” There’s nothing wrong with a boss being like a parent to his/her employees in the sense of looking out for their best interests. That’s actually very commendable, in this day and age. But if the player at hand wants to play (as was the case with Tim Duncan, when he faced an injury, in the 2000 NBA Playoffs), I say let him play!

I think the best bosses trust the decision-making of their employees. It comes as no surprise to me that Phil Jackson — nicknamed “The Zen Master” — trusted Michael Jordan’s decision to want to play in the infamous “Flu Game” 20 years ago. If an employee seems sincere and genuine about a decision that directly involves him/her, regardless if it’s subjectively a “bad” decision, you just have to go with it and trust the other person’s consciousness. I think Phil gets it, but Pop doesn’t get it — and, either way, it’s okay in the end.

Whoever is hired to succeed Pop once he retires (and that, I think, will be a very sad day in San Antonio), I hope that person is familiar with both the Zen philosophy of Phil and the dad-like philosophy of Pop. And I also hope that person is familiar with the fundamentals of behavioral economics.