Valuing Australian football league draft picks

To ensure uncertainty in match outcomes, professional sporting leagues have used various competitive balance policies, including player salary caps, revenue sharing among teams and player drafts. The Australian Football League (AFL) introduced a player draft in 1986, and to refine its operation, a draft value index (DVI) was introduced in 2015. The DVI allocates a numeric value to each individual player draft pick, with these values determined by the AFL using historic player compensation or wage and salary data. The AFL DVI plays an essential role in the operation of its player draft; however, other research has questioned the validity of such indexes. This paper aims to produce an alternative to the AFL DVI. The former index uses career compensation as the determinant of value, whereas we use other measures of player performance. First, various models were developed to predict on-field performance, such as games played (both in a recruit's career and season) after a draftee was selected for the first time by a team. This was then retrofitted to the pick used to select these draftees to create the new DVIs. Even though the predicted DVI followed an inverse monotonic function like the existing index, the decline in value for the DVI produced here was less steep, unlike the AFL's. This allowed us to conclude that players' salaries did not always strongly correlate to performance. The change in performance between players selected at different points in the draft did not vary as much as their wages. Though this scheme is applied to the AFL, the underlying concept could be directly exported to other player drafts.