Vega$ the NBA and Parity

By David Marasco

This off season the big talk in the media has been steroids. It's a nice change of pace from what we normally get at this time of the year. For the past few Springs we've had to read about the decline of parity in baseball. Only a small handful of teams supposedly has a shot at the ring. Whether or not this problem exists is open to debate, but there certainly seems to be a perception in the media of a lack of parity.

This perception can be easily tested. We have a way of calibrating the sporting public's view of a team's odds. In fact, we just look at the odds; the Vegas line does not actually measure reality, it measures the gambling public's perception of how the season will unfold. Here are the data from sportsbook.com the weekend before the start of the 2004 MLB season:

OK, the first thing you do is realize that two of the top three favorites are the Red Sox and the Cubs, and you have to rub your eyes a little bit. The second thing to do is ask about what this would look like in a balanced league. Well, not accounting for the casino's cut, in a league with perfect parity every team would go off at 30-1. So an "even chance" in baseball is 30-1 or better. Looking at the Vegas odds, 12 out of 30 teams, 40% of the league, goes off at even odds or better. Some teams are going to be worse than even, but how many teams have "half a chance"? Well, half an even chance would be 60-1 or better, so add in another 8 squads. In baseball 20 out of 30 teams have at least half a chance.

What's our comparison here? Well, let's look at the NBA, a league with a salary cap and strong revenue sharing (you know, the classic proposed to solve baseball's parity problems). Here's sportsbook.com's lines from a day into the NBA season:

What do we get out of this? Well, there are 29 teams in the NBA, so only seven teams in the NBA are going off at better than even odds. That's less than a quarter of the league as opposed to 40% for baseball. How about the middle real estate? How many NBA teams go off at half a chance or better? Add in three teams. That's right, three teams. So only ten teams in the NBA were considered to have half a chance at the title. One third of the league as opposed to two thirds of baseball. What about the really bad teams? Twelve teams in the NBA were considered to be 100-1 or worse; while 40% of baseball has an even chance or better, 40% of the NBA is considered doomed. Baseball has its bad teams also, but not nearly as many as the NBA.

That's how Vegas sees things, and they have made a lot of money understanding how people view sports. If the sports columnists want to ask "how can fans watch baseball when so many teams don't have a shot right out the gate", they need look no farther than the NBA.