With the dust settling on the World Cup Final last Sunday, we are still debating various aspects of the game and the tournament itself, such as those raised by Brian below on July 12. One of the biggest issues is how to deal with imperfections in the sport, such as badly-designed balls, player simulation, the occasional 'howler' by referees and teams going out on penalty shoot-outs. With this in mind, the good people at 'The Sports Economist' invited me to produce a guest-post on the latter.
The 2006 World Cup Final between Italy and France brought this 'tragedy' (as once surmised by Sepp Blatter) to light once again, even if this tragedy was overshadowed by the Zidane-Materazzi incident. While Ghana and Japan were the only unfortunates in this installment, we were only four more scoreless minutes from witnessing the same tragedy occurring once again in the all-important Final before Andres Iniesta's decisive strike.
Along with my colleague Jan Libich, and Petr Stehlík from University of West Bohemia, we were motivated to look at alternative solutions to the penalty shoot-out problem – our objective being to create the right incentives for teams to attack in extra-time, so that extra-time does its sole job of separating the teams. As economists, we know that incentives are critical here, and that they explain the dismal failure of the so-called 'Golden Goal' - because it gave teams precisely the wrong incentives to attack.
We ended up looking at a proposal to merely shift the penalty shoot-out to BEFORE extra-time, with the winner of the shoot-out taking the contest only if the subsequent extra-time remains level. Such a change would induce the team that lost the shoot-out to attack since they have to score to win. If they succeed, then the other team also has to score to tie the extra-time, putting them back in the winning position.
We simulate the effect of this rule proposal using actual match data from numerous elite-level knockout competitions around the World (including the World Cup itself) by comparing outcomes from the status quo to scenarios where we believe the incentives to both teams closely approximate what this rule would do. We find that the rule would create significantly more attacking play and reduce the incidence of scoreless extra-times from nearly 50% currently to under 25%.