NBA Payrolls: Can Money Buy Wins?

As the GM of your company, you’re always trying to get the most out of your payroll. You want your team to produce results and it’s a fine balance between paying enough to get that performance and overpaying.

With the NBA getting underway on Christmas day, we thought it would be interesting to look at payrolls around the league and how they correlate to performance. Based on our data mining of last year’s costs per win and costs per loss, we have projected the overall league standings for this year’s 66-game regular season.

At the end of the season, we can measure our projections against the real world standings*, and see what teams are able to maximize their payrolls. Some key data points to monitor:

• The L.A. Lakers have the highest payroll in the league (more than $90 million), but are only projected to finish 6th overall.
• The Chicago Bulls are projected to finish 1st in the standings, but only rank 11^th in payroll.
• The Miami Heat are projected to finish 2^nd and rank 3^rd in payroll and San Antonio, projected to finish 3^rd, are ranked 4^th in payroll. The Heat and Spurs are the only two teams projected to be in the top 5 in the standings that are also in the top 5 in payroll.
• The Oklahoma City Thunder are projected to finish 5^th with only the 21^st largest payroll.

Orlando and Denver project to finish well above their payroll rank while teams like Atlanta, Philadelphia and Detroit appear to be spending more for less. The New York Knicks are also notable for jumping 14 spots in payroll spending, which projects them to jump eight spots in the standings.

Take a look at our data to see how well you think your favorite team is spending on its payroll and give us your feedback in the comments section or on Facebook and Twitter.

Data provided by www.spotrac.com/nba

*With the caveat that our standings can’t necessarily account for the impact of trades and acquisitions—payroll figures can’t measure how lethal the alley-oop combination from Chris Paul to Blake Griffin will be on the new-look L.A. Clippers—or what role major injuries might play during the season.