competitive balance is measured using the NollScully Ratio w

competitive balance is measured using the Noll-Scully Ratio which was covered in Chapter 2. Using the information from their output, interpret the findings using the previous literature on the amateur draft (particularly the NBA amateur draft) and articulate to NBA decision makers what you have found from the regression results in regards to league policies, particularly the effect of the draft policies on on competitive balance. Note: all of these variables outside of the dependent variable and percent of playoff teams are a 1/0 variable with I meaning Yes and 0 meaning No. Further, I am not looking/or an exact impact on competitive balance. I want to know whether the variables significantly improves, significantly deteriorates, or does not have any impact on competitive balance (25 points)

Solution

In the above results, * denotes a significant impact. In simple terms, more the number of *, higher impact the variable has.

So *** means more significant impact than **, which is higher than *.

The coefficients with a positive sign denote improving of competitive balance and those with negative signs denote deteriorating impact.

So, variables which strongly and significantly improve the balance:

Equal chance , Exapnsion

Variables which significantly improve the balance:

Weighted lottery increased weights

Variables which strongly and significantly deteriorate the balance:

ABA Merger

Variables which significantly deteriorate the balance:

Percent of playoff teams.