Resident Scholar Kevin A. Hassett

Players will be put through physical and mental tests, interviewed by teams and subjected to intense media scrutiny. This allows teams to gather information to rank the players in preparation for April's National Football League draft.

Thus, it is an opportune time to revisit a column I published last May 1.

That column, which argued that many NFL teams make rudimentary economic mistakes that harm their competitiveness, was headlined: Who Won the NFL Draft? Economics Say Green Bay.'' In it, I drew on cutting-edge research conducted by Yale University economist Cade Massey and University of Chicago economist Richard Thaler to rank the winners and losers of the draft.

Now that the season is over, the results are in. Did the teams that economic theory suggested won the draft outperform others? The results are pretty striking. NFL coaches would be advised to stay away from the combine and crack open their economic textbooks instead.

To recap, Massey and Thaler studied the draft and found that teams make systematic errors. They tend to place too high a value on the top players and too low a value on draft picks a little farther down.

Top Players, Top Salaries

The problem is, the very top players in the draft receive very high salaries. Even if they compete brilliantly, it's hard for them to outperform their earnings. But by definition, since all teams have to operate within the same salary cap, winners have to have teams that are filled with players who outperform their paychecks.

Last year's top overall pick, Mario Williams of the Houston Texans, is a nice example. He received a salary package worth $54 million over six years--and proceeded to play like a fairly mediocre defensive end. He was the sixth-leading tackler on his team, and recorded only 4 1/2 sacks.

While those numbers suggest Williams will be a serviceable NFL competitor, he was compensated as one of the best defensive players in the league. And since the total salary bill for the team is capped by the league, the money spent on Williams is money that can't be spent on players at other positions. That undermines their ability to compete.

Bargain Picks

On the other hand, players a little farther down in the draft can be enormous bargains. Take Houston's second-round pick DeMeco Ryans. He led the NFL in tackles, but only received a contract of $5 million over four years. Good teams fill their roster with such deals and avoid committing huge resources to the big-money players like Williams.

The Massey and Thaler paper estimated a value for each position in the draft, and I used these last May to construct a list of the winners and losers in the player selection. Four teams really stuck out as winners: the Green Bay Packers, the New York Jets, the St. Louis Rams and the Minnesota Vikings.

The 2006 season results suggested that economic theory worked well. With the exception of Minnesota, which won three fewer games than it did in 2005, these were among the most improved teams in the league, with the Jets winning six games more than in 2005, the Packers winning four more, and the Rams winning an extra two. On average, being a draft winner was worth 2.25 additional wins.

Biggest Losers

The theory also identified the biggest losers. The first four on this list, the Washington Redskins, Miami Dolphins, Denver Broncos and Atlanta Falcons, all surprised their fans on the downside this season, winning on average 3.5 fewer games than they did in 2005. The Redskins, in particular, showed up as major flops after the draft, and then delivered on that promise in the season. After winning 11 games in 2005, they only won five in 2006.

To be sure, the indicator wasn't perfect at selecting losers. The theory predicted that Tennessee and New Orleans would do poorly, and they didn't. But it is probably safe to chalk this up to other reasons. New Orleans lucked into signing Pro Bowl quarterback Drew Brees in the off-season, which offset their economic misfortune of drafting enormously expensive running back Reggie Bush.

But on balance, economic wisdom has defeated football wisdom once again. It will be interesting to see if the evidence will change the economically challenged behavior of teams like the Redskins.

Kevin A. Hassett is a senior fellow and director of economic policy studies at AEI.