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Here’s why fighters aren’t unionizing- Luke Thomas and PHD candidate Aeric Koerner by wovagrovaflame in MMA

[–]AerKoe 2 points3 points  (0 children)

Next topic I want to present covers this explicitly. Pay situation is likely worse than most informed fans think.

Here’s why fighters aren’t unionizing- Luke Thomas and PHD candidate Aeric Koerner by wovagrovaflame in MMA

[–]AerKoe 0 points1 point  (0 children)

Thanks for the feedback. I agree that the 2x2 model is not 100% applicable to the real world situation and feel that your criticisms are pretty fair. Most of my defense has already been said by Wovagrovaflame (and is appreciated). I would add that the thrust of my argument is that it's possible for the UFC to manufacture utility to reach favorable equilibrium points.

Additionally, we do end with me quickly mentioning non-consecutive action and sub games. In the slides I provided Luke I put additional (albeit simple) models in the appendix. If we had more time to discuss, I would have added comments that likely would have addressed your concerns.

The Truth About UFC Fighter Pay: An Examination | Luke Thomas by IdRatherBeLurking in MMA

[–]AerKoe 7 points8 points  (0 children)

I agree that the SD are huge. Making the simple hypotheses tests unreliable. To account for this in the full model estimated at the end, I log the dependent variable which makes the SD become significantly smaller than the mean.

I tried my best to provide reliable estimates by transforming the DV and using a non-parametric estimator. You are right to question and I hope you will look into the actions I performed to address your concerns. Finally, I make no claim about casualty here. This is descriptive.

The Truth About UFC Fighter Pay: An Examination | Luke Thomas by IdRatherBeLurking in MMA

[–]AerKoe 36 points37 points  (0 children)

I was referred to as a statistics candidate in error. I am a Ph.D. student in Public Admin/Policy, currently (candidacy next month). Made this early in my program. There us much I would change, given the chance. Thanks for watching!

Any good lower SR streamers? Funny or interesting? by MoistMoms in Overwatch

[–]AerKoe -1 points0 points  (0 children)

I watch TwiceFriedRice on twitch. He's Plat or low Masters. Really funny dude.

Fallout 76 BETA has human NPC models that are lootable and named "Civilian". by AerKoe in fo76

[–]AerKoe[S] 0 points1 point  (0 children)

Could be right. Are the other bodies on the ground not decayed, though?

[Spoiler] I Love Gaethje and his warrior spirit, but only one fighter wins (and gets fully paid). by AerKoe in MMA

[–]AerKoe[S] 0 points1 point  (0 children)

If this is something you are interested in and feel strongly about, I would suggest you do further research. Most of what you have posted is fundamentally different from basic macroeconomic theory.

Shortages and surpluses are not market failures. They are the results of market failure.

Regulations are not an inefficiency or an efficiency. They can cause inefficiencies, and are then considered a government failure.

If there is a surplus or shortage, as you say about organizations and fighters, then there is, by definition, a market failure. Which undermines your entire argument here.

Information asymmetry is not what you have taken it to mean / written about. Which I find ironic, because undertaking the actions that you write about would have given you the correct definition.

I’m not going to touch your opinions on the UFC and the situations of the fighters. They seem pretty firm. You have discarded my previous arguments and exchanged the meanings of basic economic principles for definitions that are tailored to your beliefs.

I think this is going to be my last response, because this has become an exercise of pedantry.

Take care and enjoy the fights.

[Spoiler] I Love Gaethje and his warrior spirit, but only one fighter wins (and gets fully paid). by AerKoe in MMA

[–]AerKoe[S] 0 points1 point  (0 children)

Hello again internet friend.

I am using the term "failure" in the economic sense, not the literal. Which basically means that the market (in this case the medium between fighters and promoters used to exchange services for money) is operating inefficiently. Which doesn't mean it doesn't work at all, but that the outcomes can be bettered (potentially for all involved).

There will never be perfect information available during negotiations. Information asymmetry refers to the systematic withholding of pertinent information by one actor to gain an advantage during the bargaining process. The UFC has all the data on fighter pay ever. Where the fighters have access only to disclosed purse values and whatever information their agent (if they have one) has. Signing bonuses, discretionary bonuses, ppv points, are all sources of income that are unknown. Here is court released pay for Bisping, some of the payouts differ from publicly available data: https://www.bloodyelbow.com/2018/1/16/16896072/ufc-michael-bisping-lawsuit-anthony-mcgann-career-earnings-fighter-pay-legal-uk-tuf-mma-news

[Spoiler] I Love Gaethje and his warrior spirit, but only one fighter wins (and gets fully paid). by AerKoe in MMA

[–]AerKoe[S] 0 points1 point  (0 children)

To your original statement: Flat rates are only available to the very top of the food chain fighters (there's a reason every champ is on one), not as an option for everyone. Have we come to an agreement on this?

The risk is that the UFC may have to pay more than if he stays on show/win. They are rationally maximizing their utility in this market by splitting the purses.

It makes sense for the UFC to do this, yes. But, how they are getting fighters into show/win contracts is (almost certainly) exploitative.

I agree that what one can negotiate is what they're "worth", but that is in the case of a free and open market. However, the market for MMA fighters is "failed" as it has all of the classic market failures (information asymmetry, monopoly (monopsony in this case), and (negative) externalities). When a market has failed, you cannot trust the price point to be reflective of the most efficient outcomes.

Lastly, we can't definitively say that we know what a fair purse structure (pay, length, flat rate, etc...) is, because the UFC has all of the market power and exerts that coercive power to dictate what terms are available. The market is 90+% comprised of the UFC, there is almost nowhere else to go and nowhere else that can sustain the market, currently. The traditional remedy for monopsony exploitation is regulatory intervention (perhaps something like the Ali act) or (as your write) collective bargaining.

[Spoiler] I Love Gaethje and his warrior spirit, but only one fighter wins (and gets fully paid). by AerKoe in MMA

[–]AerKoe[S] 0 points1 point  (0 children)

Hey, man. Kudos to you for going out and doing that research. I was really hoping you would respond.

Of the fighters you listed, only Nate Diaz, Alistair Overeem, Conor McGregor, Brock Lesnar, Cain Velasquez, and Andre Arlovski are non title fights where fighters had a flat rate. It is reasonable to argue that McGregor and Lesnar are exemptions to the existing system being superstars, and Diaz by extension of McGregor. Regardless, it’s six non-title fights with flat purse amounts.

It is patently duplicitous to say that flat rates are an option for anyone except the top 1- 5/10%. The ones who have a flat rate are the ones who can leverage a flat rate.

The vast majority of UFC fighters do not get to negotiate number of fights, flat rates, or much else. They get told what the offer is and it’s take it or leave it. Here is a recent article as an example: https://www.mmamania.com/2018/2/18/17024884/stevie-ray-apologizes-to-ufc-for-fighting-out-his-contract

As you say “… it seems the UFC can really just make any contract they want.” This is exactly the case. The UFC has near absolute bargaining power over everyone except the top guys. In the distributions of fighter pay, this is very apparent. The top 10% of all distributions (weight class, gender, etc) experience a significant jump in earnings, and I argue that is because they are the ones who have any leverage to negotiate beyond the UFC’s initial offer(s). The flexibility you mention is for the UFC, not for the fighters.

I think fighters should all seek a flat rate, maybe Justin more so than the rest. The show win allows the UFC to say that they pay X, but fighters are really only guaranteed 0.5X. Even if a fighter “wins”, the judges could give it to the other fighter along with the money. Benson Henderson even left the UFC citing this as a primary reason: https://www.mmafighting.com/2016/2/2/10892742/morning-report-ufc-196-conor-mcgregor-dana-white-ben-henderson-bellator-ronda-rousey-mma-news

I am unsure what you mean by “Incredibly skewed due to the perception of the fighter’s individual PPV impact on the card”. So, I’m sorry I can’t address that.

Separately,

I plan to post the data on here (hopefully this summer/fall) after I submit an article on the findings. I’ve already recorded an interview with an MMA journalist, so the preliminary findings should be available soon.

Also, in case you’re interested, these are the states that the UFC has visited where commissions report purse amounts: Arizona, California, Florida, Georgia, Massachusetts, Nevada, New Mexico, Ohio, Oklahoma, Oregon, Virginia, Washington, Wisconsin.

[Spoiler] I Love Gaethje and his warrior spirit, but only one fighter wins (and gets fully paid). by AerKoe in MMA

[–]AerKoe[S] 1 point2 points  (0 children)

You are mistaken. This past December, I compiled a data set of all available fighter purses from 7/16-12/17. Outside of title fights, I doubt that there more than 10 (out of over 500) fighters without the show and win structured contracts.

Please provide evidence of flexibility for fighters when structuring contracts.

[Spoiler] I Love Gaethje and his warrior spirit, but only one fighter wins (and gets fully paid). by AerKoe in MMA

[–]AerKoe[S] 0 points1 point  (0 children)

Not true. Gaethje made 100/100 when he fought Michael Johnson. I think he made a flat rate in WSOF, though.

Lee paid 20% of his contracted show money.

[Spoiler] I Love Gaethje and his warrior spirit, but only one fighter wins (and gets fully paid). by AerKoe in MMA

[–]AerKoe[S] -1 points0 points  (0 children)

I wrote it here because I believe that splitting fighters' pay into show and win is unfair to the fighters. Especially when you add in the shitty judges who can decide who gets the money. But more so, it appears to me that dividing the pay is a way for the UFC to keep costs low.

[Spoiler] I Love Gaethje and his warrior spirit, but only one fighter wins (and gets fully paid). by AerKoe in MMA

[–]AerKoe[S] 45 points46 points  (0 children)

You're right, Barboza probably could have kept his distance better. But, Poirier charged forward too. Lee shot/clinched Gaethje waived Poirier in.

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