Thursday, January 7, 2010

Free Agency in Hockey

This analysis is fundamentally flawed. There are three types of restricted free agent: those who sign after their entry level contracts and are ineligible for salary arbitration, those who sign after their second contract and only sign to play in years when they would be a restricted free agent anyway, and restricted free agents who sign long term contracts that include years they would otherwise be unrestricted free agents.

Assuming unrestricted free agents are better paid (the conclusion of his analysis), that effect cannot be measured without parsing out the three kinds of restricted free agent signings. The players ineligible for arbitration will probably have depressed salaries, and those signing away unrestricted years are undoubtedly being paid a premium for that.

Hopefully he will fix these problems. A paper I wrote recently could have used an exact analysis of this, though it was a tangential issue.

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