Get 20M+ Full-Text Papers For Less Than $1.50/day. Start a 14-Day Trial for You or Your Team.

Learn More →

Catch and release? NHL expansion draft endowment effects

Catch and release? NHL expansion draft endowment effects The purpose of this paper is to investigate National Hockey League (NHL) expansion draft decisions to measure divestment aversion and endowment effects, and analyze bias and its affect on presumed rational analytic decision making.Design/methodology/approachA natural experiment with three variables (age, minutes played and presence of a prior relationship with a team’s management), filtered athletes that were exposed or protected to selection. A machine learning algorithm trained on a group of 17 teams was applied to the remaining 13 teams.FindingsAthletes with pre-existing management relationships were 1.7 times more likely to be protected. Athletes playing fewer relative position minutes were less likely to be protected, as were older athletes. Athlete selection was predominantly determined by time on ice.Research limitations/implicationsThis represents a single set of independent decisions using publicly available data absent of context. The results may not be generalizable beyond the NHL or sport.Practical implicationsThe research confirms the affect of prior relationships on decision making and provides further evidence of measurable sub-optimal decision making.Social implicationsDecision making has implications throughout human resources and impacts competitiveness and productivity. This adds to the need for managers to recognize and implement de-biasing in areas such as hiring, performance appraisal and downsizing.Originality/valueThis natural experiment involving high-stakes decision makers confirms bias in a setting that has been dominated by students, low stakes or artificial settings. http://www.deepdyve.com/assets/images/DeepDyve-Logo-lg.png Sport, Business and Management: An International Journal Emerald Publishing

Catch and release? NHL expansion draft endowment effects

Download PDF
12 pages

Loading next page...
 
/lp/emerald-publishing/catch-and-release-nhl-expansion-draft-endowment-effects-S2wnCf02gZ
Publisher
Emerald Publishing
Copyright
© Emerald Publishing Limited
ISSN
2042-678X
DOI
10.1108/sbm-04-2018-0028
Publisher site
See Article on Publisher Site

Abstract

The purpose of this paper is to investigate National Hockey League (NHL) expansion draft decisions to measure divestment aversion and endowment effects, and analyze bias and its affect on presumed rational analytic decision making.Design/methodology/approachA natural experiment with three variables (age, minutes played and presence of a prior relationship with a team’s management), filtered athletes that were exposed or protected to selection. A machine learning algorithm trained on a group of 17 teams was applied to the remaining 13 teams.FindingsAthletes with pre-existing management relationships were 1.7 times more likely to be protected. Athletes playing fewer relative position minutes were less likely to be protected, as were older athletes. Athlete selection was predominantly determined by time on ice.Research limitations/implicationsThis represents a single set of independent decisions using publicly available data absent of context. The results may not be generalizable beyond the NHL or sport.Practical implicationsThe research confirms the affect of prior relationships on decision making and provides further evidence of measurable sub-optimal decision making.Social implicationsDecision making has implications throughout human resources and impacts competitiveness and productivity. This adds to the need for managers to recognize and implement de-biasing in areas such as hiring, performance appraisal and downsizing.Originality/valueThis natural experiment involving high-stakes decision makers confirms bias in a setting that has been dominated by students, low stakes or artificial settings.

Journal

Sport, Business and Management: An International Journal – Emerald Publishing

Published: Jun 13, 2019

Keywords: Decision making; Bias; Endowment; NHL; Divestment aversion; Expansion draft

References

  • Cognitive biases and decision support systems development: a design science approach
    Arnott, D.
  • The case for the natural science model for research in organizational behavior organizational theory
    Behling, O.
  • Do sell-side stock analysts exhibit escalation of commitment?
    Beshears, J.; Milkman, K.L.
  • Replication effort provokes praise – and ‘bullying’ charges
    Bohannon, J.
  • Escalation effects and the player draft in the AFL
    Borland, J.; Lee, L.; Macdonald, R.D.
  • Estimating the effects of age on NHL player performance
    Brander, J.A.; Yeung, L.; Edward, J.
  • The econometrics and behavioral economics of escalation of commitment: a re-examination of Staw and Hoang’s NBA data
    Camerer, C.F.; Weber, R.A.
  • Better than rational: evolutionary psychology and the invisible hand
    Cosmides, L.; Tooby, J.
  • Building theories from case study research
    Eisenhardt, K.M.
  • Biased estimates of treatment effect in randomized experiments with nonlinear regressions and omitted covariates
    Gail, M.H.; Weiand, S.; Piantadosi, S.
  • Experimental tests of the endowment effect and the Coase theorum
    Kahneman, D.; Knetsch, J.L.; Thaler, R.
  • Willingness to pay and compensation demanded: experimental evidence of an unexpected disparity of measures of value
    Knetsch, J.L.; Sinden, J.A.
  • Opening up decision making: the view from the black stool
    Langley, A.; Mintzberg, H.; Pitcher, P.; Posada, E.; Saint-Macary, J.
  • Impact of GDSS: opening the black box
    Limayem, M.; Banerjee, P.; Ma, L.
  • Opinions-attitude methodology
    McNemar, Q.
  • The loser’s curse: decision making and market efficiency in the National Football League draft
    Massey, C.; Thaler, R.
  • Mingling decision making metaphors
    Meyer, A.D.
  • The structure of unstructured decision process
    Mintzberg, H.; Raisinghani, D.; Theoret, A.
  • Loss aversion and managerial decisions: evidence from Major League Baseball
    Pedace, R.; Smith, J.E.
  • Losing face and sinking costs: experimental evidence on the judgment of political and military leaders
    Renshon, J.
  • Rituals in information system design
    Robey, D.; Markus, M.L.
  • Status quo bias in decision making
    Samuelson, W.; Zeckhauser, K.
  • Herd behavior and investment
    Scharfstein, D.; Stein, J.
  • A pyramid of decision approaches
    Schoemaker, P.J.H.; Russo, J.E.
  • Escalation bias in performance appraisals: an unintended consequence of supervisor participation in hiring decisions
    Schoorman, F.D.
  • An alternative to the NFL draft pick value chart based upon player performance
    Schuckers, M.
  • Strategic decision making
    Schwenk, C.R.
  • Knee-deep in the big muddy: a study of escalating commitment to a chosen course of action
    Staw, B.M.
  • Sunk costs in the NBA: why draft order affects playing time and survival in professional basketball
    Staw, B.M.; Hoang, H.
  • The effects of goal distance and value in escalation of commitment
    Ting, H.
  • Is decision-based evidence making necessarilly bad?
    Tingling, P.M.; Brydon, M.J.