Relative Salary Efficiency of PGA Tour Golfers: A Dynamic Review

Transcription

1 Relatve Salary Effcency of PGA Tour Golfers: A Dynamc Revew Julo Cesar Alonso Unversdad Ices Julan Benavdes Unversdad Ices Based on one-year sample, Nero (2001) estmated golfers' usng four performance measures. We study the effects of the golfers abltes and sklls on ther by estmatng a producton functon for four dfferent years (1995, 2000, 2005 and 2009). Our fndngs suggest that the effect of each skll and ablty changes over tme. In ths sense, our results show that prevous work as Nero (2001) cannot be extrapolated to other years. We also show that a dynamc approach s needed to understand the nature of professonal golfers' job performance. Our analyss s complemented by estmaton of a stochastc producton possblty boundary for each year under study. Ths allows us to classfy PGA golfers accordng to ther relatve effcency. We found that for the 2009 season Phl Mckelson was the most effcent golfer and Bran Bateman the least effcent one. The results also allow us to estmate how much a golfer would have earned gven hs abltes and sklls assumng that he had played as well as the most effcent golfer. Camlo Vllegas, for example (the Colomban golfer also known as spder man), earned US$1.8 mllon n If he were as effcent as Phl Mckelson was n the 2009 season, he would have earned US$7.8 mllon: 4.33 tmes more than what he actually earned. INTRODUCTION Studes on professonal athletes' shed lght on the knds of abltes that lead to generatng the hghest returns. In a broader sense, these studes help to advance our understandng of costs and productvty. Professonal sports also provde a specal opportunty for applyng job performance measures to real data that s free of measurement error (Nero, 2001). Another advantage of studyng professonal sports s that sports statstcs allow us to accurately measure athletes' productvty and fnd drect relatons between the dfferent components of ther game and ther results. It's common to fnd these types of studes carred out usng statstcs of baseball players' battng records, runs scored, and games won. Nevertheless, baseball s a team sport and thus adds an addtonal varable to measurements. Golf s essentally dfferent: beng a fundamentally ndvdual sport, a golfer's productvty depends solely on hs ndvdual abltes. Surprsngly, there are few productvty studes that make use of golf statstcs (Moy and Law, 1998; Nero, 2001; Scully, 2002; Scott and Thomas, 2007, Shmanske, 2007; Rnehart, 2009). Ths document evaluates the relatve effcency of PGA Tour golfers. We study the effect of golfers abltes and sklls on ther by estmatng a producton functon. To ths end, we use the przes earned by professonal golfers and a set of varables that represent ther sklls n the game to buld a lnear regresson model that allows us to: ) determne what facets of a players' game are the most 120 Journal of Appled Busness and Economcs vol. 14(1) 2013

2 mportant for wnnng larger przes, and ) determne whch golfers have the hghest prze-derved ncome gven ther performance statstcs; and fnally, ) determne whch golfers have a more effcent performance than ther fellow colleagues. Ths document also presents an estmate of the effcent boundary of PGA Tour golfers. The model produces estmates for dfferent years. Ths approach enables us to answer the queston "what factors determne professonal golfers' salares?" whle stll takes nto account temporary and dynamc factors - absent n almost all prevous studes (Rnehart, 2009). Our results suggest that the effect of each skll and ablty changes over tme. In ths sense, our results show that prevous fndngs (Nero, 2001) based on one-year samples cannot be extrapolated and that a dynamc approach s needed to understand the nature of professonal golfers' job performance. Moreover, our results demonstrate that, n general, the model qualty deterorates over tme, even gvng a varable wth counterntutve sgn n In terms of golfers' rankng, we found that 2009's most effcent golfer was Phl Mckelson. Ths artcle s organzed as follows: The frst secton s the ntroducton, the second s the lterature revew, the thrd s the results report, and the fourth provdes the conclusons. LITERATURE REVIEW The present artcle follows n the lne of Nero (2001) who studes golf professonals' performance n Nero (2001) chooses the 130 golfers wth the hghest n 1996 and performs a logarthmc regresson on ther, the length of ther drves, ther accuracy, and ther abltes. As also found n the present artcle for the years under study, for the years 1995 and 2000, Nero (2001) concludes that mprovements n puttng pay off more than an ncrease n drve dstance. Addtonally, Nero (2001) analyzes a golfer's maxmum ncome gven hs abltes f he had been as effectve as the most effectve golfer, thus ncludng hs ablty to deal wth pressure. Scott and Thomas (2007) model golfers' performance usng a set of equatons and argue that the money that they earn s an ndrect result of the golfer's ablty. In ther calculatons, a golfer's number of strokes s the result of hs abltes and experence whle hs average rankng s a functon of the number of strokes and the number of events/tournaments (Scully 2002). Lastly, a golfer's are determned by hs rankng and number of completed events, the last beng the producton equaton and the frst two beng ntermedate outcomes. Although ther contrbuton s mportant, ther conclusons are smlar to those found n earler artcles, n whch puttng s the most mportant factor n a golfers' set of abltes. Shmanske (2008) proposes that the use of players' annual averages does not provde an accurate estmate of players' performance, so he assembles a database that ncludes performance per tournament. Ths allows us to ncorporate the partculartes of each golf course nto the model. Addtonally, Shmanske (2008) makes use of a two-stage equaton system for comparng golfers' performance wth ther fnancal achevements. In hs tests he also ncludes the varance and asymmetry of each varable as a determnng factor of the number of strokes and, consequently, of a golfer's wnnngs. Hs contrbuton focuses on the hgh R2 of hs regressons. Fnally, Rnehart (2009) goes back to usng annual statstcs to study whether returns on golfers' performance changed between 2002 and He does not fnd any evdence that ths has happened. Hs nteracton varables are not sgnfcant for any of the basc ablty varables. ASSUMPTIONS As a sport, golf s not complex n and of tself. The goal s to ht a ball wth a stck from a preestablshed pont (a "tee") nto a hole n the least possble number of strokes. Each golf course has 18 holes and a 72-stroke par. Ths means that t s expected that a golfer complete the course n 72 strokes. From the startng pont to the hole there s an area (the farway) over whch the golfer wll drve the ball. The farway s bordered by forested areas and sand traps (bunkers) that make drvng dffcult f the ball lands there. Farways are so long as to be traversed between one and three strokes. The hole s surrounded by the green, an area wth hghly mancured grass that makes puttng easer. Each hole also has ts own Journal of Appled Busness and Economcs vol. 14(1)

3 par. The number of strokes n whch a player should complete a hole vares from three to fve, two of whch are putts on the green and are added to strokes requred for traversng the farway. A golfer's skll thus depends on hs power and precson. Strokes on the farway must be strong and precse: a strong golfer can reach a par fve green n two strokes. Meanwhle, strokes on the green must smply be precse. Moreover, golfers must be able to recover when ther strokes don't land them n frendly terrtory. When a golfer scores one stroke less than the hole's par, t's called a brde. If two strokes less, then t's called an eagle. On the other hand, f a golfer scores one stroke more than the hole's par, t's a bogey. If two more, then a double bogey, and so on. Hence, n order to measure a golfer's skll, you must know the average length of hs drves (strength), the number of tmes that hs drve lands on the farway (drve precson), the average number of putts (putt precson), and the number of tmes that he completes the hole and scores par after havng landed off the farway or n bunkers (ablty). Good scores on each of these parameters are expected to be statstcally correlated to ther wnnngs. It s evdent that ther wnnngs wll also be correlated wth the number of tournaments n whch golfers partcpate. Followng Nero (2001), the below formula wll be used to model prze money made by each golfer n a season: ( EARN ) ln EARN DRIVE PUTT SAND Events DRIVEACC (1) whereas, DRIVE represents the average drve length, and PUTT represents the average number of putts (strokes on the green) per player. Lkewse, SAND s the percentage of tme that a player completes a hole n a maxmum of two strokes after havng landed n a bunker that borders the green. Events s the number of tournaments n whch a player partcpates each year. DRIVEACC s the percentage of tmes that a drve lands on the farway. Lastly, s a homoscedastc, non-autocorrelated zeromean random error term. Varable defntons are contaned n Table 1a whle descrptve statstcs for the same are reported n Table 1b. Averages shown n Table 1b reveal an mprovement n drve dstance from 2005 onward, ncreasng from 273 to 299 yards. Ths mprovement seems to have been obtaned at the cost of precson, whch fell from 68% to 62%. The SAND percentage also drops from 53% n 2000 to nearly 49% n 2005 and The average number of putts falls slghtly n 2009 from 1.6 n 2000 and 2005 to 1.55 n TABLE 1a VARIABLE DESCRIPTION Name EARN DRIVE PUTT SAND Events DRIVEACC Varables Descrpton Wnnngs. Amount of prze money won. Drve dstance. Average dstance n yards. Puttng. Average number of strokes on the green. Gettng out of bunkers. The percentage of tmes that a player requres a maxmum of two strokes to make a hole from a bunker that borders the green. Events. The number of tournaments played per year per player. Strokes on the farway. The percentage of strokes that land on the farway. 122 Journal of Appled Busness and Economcs vol. 14(1) 2013

4 Year EARN (prces as of 2009) TABLE 1b DESCRIPTIVE STATISTICS DRIVE PUTT SAND Events DRIVEACC Average 2000 $ 963, SD 2000 $ 1,163, Asymmetry coeffcent Average 2005 $ 1,234, SD 2005 $ 1,025, Asymmetry coeffcent Average 2009 $ 1,292, SD 2009 $ 1,263, Asymmetry coeffcent Usng nformaton from the PGA's (Professonal Golf Assocaton) database and employng the ordnary least squares method, Model 1 was estmated separately for the years 1995, 2000, 2005 and The results are reported n Table 2. For each of the models, Breush-Pagan, Goldfeld-Quandt, and Whte heteroscedastcty tests (see Appendx 1) as well as normalty tests (see Appendx 2) were performed. There was not suffcent evdence n favor of heteroscedastcty n any case. As can be seen n Table 2, all varables n the 1995 sample are sgnfcant (ndvdually and overall), but ths s not the case wth the other three samples. In the case of the 2000 sample, the SAND varable doesn't affect the prze logarthm and, therefore, the followng model was used: ln EARN DRIVE PUTT Events DRIVEACC (2) Ths model s also used n Table 2. For the 2005 and 2009 samples, the coeffcent assocated wth the Events varable sn't sgnfcant. Therefore, the followng model was used: ln EARN DRIVE PUTT SAND DRIVEACC (3) These models are also reported n Table 2. It's worth notng a couple of thngs regardng the models. For all years, the expected coeffcent sgns are obtaned. The only excepton s the PUTT coeffcent for the year 2009, a sample for whch counterntutve results arse. The PUTT coeffcent for 2009 s not only counterntutve, t s also not consstent wth the effect of ths varable for the other two samples n queston. These results may be due to: A mult-colnearty problem n the 2009 sample causng the change to the sgn. A change n the way n whch affects the logarthm. There was ndeed a major change n the effect of the varable. Journal of Appled Busness and Economcs vol. 14(1)

5 TABLE 2 ESTIMATION OF DE DIFFERENT MODELS Dependent varable: ln(earn) (Statstcal t n parentheses) Model Sample Constant * ** *** *** *** (-0.719) (1.682) (2.292) (-0.598) (-0.573) (-4.163) (-4.135) (-3.196) DRIVE *** *** *** *** *** *** *** *** (8.716) (9.802) (9.738) (7.008) (7.167) (5.87) (5.846) (6.118) PUTT *** *** *** * ** ** *** *** *** ( ) (-9.233) (-9.991) (-2.368) (-2.387) (4.042) (4.295) (2.761) PUTT *** (-2.644) SAND *** *** *** *** *** *** (3.475) (1.457) (5.438) (5.349) (7.388) (7.534) (7.169) Events *** ** ** (5.123) (2.442) (2.441) (1.308) DRIVEACC *** *** *** *** *** *** *** *** (7.827) (8.782) (8.752) (4.676) (4.77) (4.2) (4.272) (4.619) R Adjusted R F *** *** *** *** *** *** *** *** N Note: (***), (**), and (*) mply rejecton of the null hypothess of no ndvdual sgnfcance wth sgnfcance levels of 1%, 5%, and 10%, respectvely. Wth respect to the frst possble reason, dfferent mult-colnearty tests were performed, and no evdence of ths problem was found. For ths reason, t was rejected as causng the counterntutve result. Wth respect to the second possble reason, the followng model was used for all samples: 2 ln EARN 1 2DRIVE 3PUTT PUTT 4SAND 6DRIVEACC (4) In the case of samples from the 1995, 2000, and 2005, the coeffcent s not sgnfcant. On the other hand, ths coeffcent s sgnfcant for the 2009 sample 2 (see Table 2). In other words, there s evdence that there s a change n the way that PUTT affects the logarthm. In ths case, Model (4) s more sutable than Model (3) for the 2009 samples (see for example the adjusted R2). Accordng to ths model, the margnal effect of an ncrease n the average of on-green strokes ( PUTT ) causes a margnal effect, the sgn of whch depends on the actual average. In other words, usng Model 4 you get: 124 Journal of Appled Busness and Economcs vol. 14(1) 2013

6 % EARN PUTT PUTT (5) Gven the estmated coeffcents, f n 2009 a player has more than 1.6 average on-green strokes ( PUTT ), the margnal effect expressed n Model (5) s negatve, as would be expected. On the other hand, f a golfer has less than 1.6 average on-green strokes, then the margnal effect s postve - a result that contnues to be counterntutve (see Fgure 1). Accordng to the sample, only 25% of golfers have more than 1.6 average on-green strokes. Therefore, the margnal effect of PUTT has the expected sgn only for the 25% of golfers wth the hghest number of on-green strokes. Ths ponts to a knd of structural change n the effect of PUTT on startng n Incdentally, the models ft relatvely well, though ft seems to dmnsh over tme: R2 goes down from 62.6% n 1995 to 39.05% n FIGURE 1 MARGINAL EFFECT OF THE AVERAGE NUMBER OF ON-GREEN STROKES If we compare the confdence ntervals for the estmated coeffcents for the dfferent samples, we fnd that all the ntervals for coeffcents assocated wth the DRIVE varable overlap each other. Ths means that t can be expected that the effect of sad varable on prze s statstcally smlar for all samples. The same happens wth coeffcents that are assocated wth DRIVEACC and SAND. In the case of coeffcents assocated wth PUTT, the ntervals overlap for 1995, 2000, and 2005, but are not comparable for Ths means that, unlke the Events varable for the years 2005 and 2009 and Journal of Appled Busness and Economcs vol. 14(1)

7 PUTT n 2009, there are no mportant changes n the effect of these varables. TABLE 3 95% CONFIDENCE INTERVALS FOR ESTIMATED COEFFICIENTS* Model Sample Constant Lower Lmt Upper Lmt Model Sample Lower Lmt SAND Upper Lmt N.A. N.A DRIVE Events N.A. N.A N.A. N.A. PUTT DRIVEACC N.A. N.A * A Bonferon correcton was performed to allow for multple comparsons We can derve other nterestng results from the estmates such as, e.g. the average elastcty of prze wth respect to other varables (see Table 4). In 2009, an ncrease of 1% n average drve yards n the vcnty of the mean resulted n an ncrease of 15.2% n. As a matter of fact, when elastcty rates are compared, t's found that the largest elastcty for each year s assocated wth drve. In other words, f golfers are lookng to mprove ther by dedcatng themselves to a 1% ncrease n any of ther abltes, they wll beneft most by mprovng drve dstance. Nevertheless, perhaps a 1% mprovement n drvng sn't as easy to acheve as mprovng 1% n other aspects of the game. Ths the reason that t s mportant to ask what part of the game matters most when tryng to account for ts effect on prze (or more exactly, the logarthm of ). To answer ths queston, we can use standardzed coeffcents (see Table 5). 126 Journal of Appled Busness and Economcs vol. 14(1) 2013

8 TABLE 4 AVERAGE ELASTICITY OF PRIZE EARNINGS Model Sample Varable Elastcty DRIVE DRIVE DRIVE DRIVE DRIVEACC DRIVEACC DRIVEACC DRIVEACC Events Events PUTT PUTT PUTT PUTT SAND SAND SAND TABLE 5 STANDARDIZED COEFFICIENTS Model Sample Varable Standardzed coeffcent DRIVE PUTT Events SAND DRIVEACC DRIVE PUTT Events DRIVEACC DRIVE PUTT SAND DRIVEACC DRIVE PUTT PUTT^ SAND DRIVEACC Note: +/- means that ths standardzed coeffcent s the largest or the smallest n absolute value terms. For 1995, 2000, and 2009, the largest standardzed coeffcent s assocated wth PUTT. For example, on average n 1995 a one-standard-devaton decrease 3 n the number of putts correlates to an ncrease of standard devatons n the logarthm, whch equals USD1.6 as of These Journal of Appled Busness and Economcs vol. 14(1)

9 results match those found by Nero (2001), who usng 1996 data, concludes that t s better to mprove puttng than drvng. In 2005, on the contrary, the largest standardzed coeffcent s that of the DRIVE varable. Ths dffers from the prevously dscussed Nero (2001) results. Here t would seem that t s better to mprove drvng than puttng. These results pont at a dynamc n the behavor of explanatory varables that couldn't be captured n the Nero (2001) study. GOLFERS' RELATIVE EFFICIENCY In order to determne golfers' relatve effcency, we can follow Nero's (2001) example n usng a non-stochastc producton boundary derved from estmated errors. Intutvely, the estmated error ( ˆ ), represents the devaton (from the logarthm) as compared to what average golfers can expect to earn gven ther sklls. In ths way, resduals show us to what extent a player s above or below ther expected averages gven hs abltes. Thus, the largest postve error allows us to dentfy the golfer who earns much more than others gven ther skll level,.e. the most effcent one. TABLE 6 GOLFERS WITH THE LARGEST AND SMALLEST RESIDUALS Year Largest error rate Player wth the Smallest error rate 1995 Blly Mayfar Tm Loustalot 2000 Carlos Franco John Daly 2005 Chrs DMarco Hdeto Tanhara 2009 Phl Mckelson Bran Bateman Table 6 shows golfers wth the best performance and worst performance gven ther performance statstcs. In 2009, for example, the most effcent golfer was Phl Mckelson and the least Bran Bateman. Now f we use a determnstc approxmaton of an effcency boundary, we can compare the relatve performance of each golfer to the performance of each season's best golfer (Nero, 2001). Each golfer's performance can be measured by adjustng observatons so that they all fall below the boundary. Ths s to say that the fronter logarthm ( LRF ) can be calculated as follows: max LRF ln EARN (6) Usng ths formula, we can nfer the amount of prze money that golfers would have earned gven ther actual performance supposng that they had played as well as the season's best. The results for these calculatons for the years 1995, 2000, and 2005 are reported n Appendx 3 whle the results for 2009 are presented n Table 7 and Table 8. These two Tables show the ten most effcent and ten least effcent golfers, respectvely. 128 Journal of Appled Busness and Economcs vol. 14(1) 2013

10 TABLE 7 THE TEN MOST EFFICIENT GOLFERS IN 2009 Player Actual Expected Boundary Effcency Phl Mckelson 5,332, ,223 5,332, Bran Gay 3,201, ,974 4,235, Steve Strcker 6,332,636 1,376,519 8,664, Brett Qugley 1,412, ,468 2,105, Jason Dufner 2,190, ,699 3,378, John Mallnger 1,717, ,308 2,865, Fred Couples 1,197, ,836 2,063, Paul Goydos 1,619, ,019 2,927, John Merrck 1,438, ,989 2,681, Padrag Harrngton 2,628, ,291 5,005, TABLE 8 THE TEN LEAST EFFICIENT GOLFERS IN 2009 Player Actual Expected Boundary Effcency Brad Adamons 333,971 1,226,956 7,722, Shaun Mcheel 257, ,976 6,206, Matthew Borchert 34, , , Steve Elkngton 243,404 1,118,180 7,038, Rck Prce 66, ,152 2,027, Darron Stles 199,385 1,102,425 6,939, Krk Trplett 155,480 1,053,318 6,630, Tommy Ganey 128,347 1,015,410 6,391, Peter Tomasulo 128,706 1,119,848 7,048, Bran Bateman 43, ,714 2,994, For example, n 2009 Bran Gay won 3.2 mllon dollars. Gven hs performance n the game, t would be expected that he would wn 700,000 dollars. If Gay were as effcent as Mckelson, he would have won 4.2 mllon dollars. In ths way, hs "effcency-boundary " are 1.32 greater than what ths golfer actually earned. Colomban golfer Camlo Vllegas won 1.8 mllon dollars n Gven hs performance n the game, t would be expected that he would wn 1.2 mllon dollars. Ths s to say, he exceeded what would have been expected of hm based on hs averages. In terms of effcency, Camlo Vllegas ranked 62nd out of 188 players n 2009 wth 23% effcency wth respect to Mckelson. On the other hand, f Vllegas had performed as effcently as Mckelson, he would have won 7.8 mllon dollars. In ths way, hs "effcency-boundary " are 4.33 greater than what he actually earned. Journal of Appled Busness and Economcs vol. 14(1)

11 CLOSING COMMENTARY Ths artcle studes the relaton between professonal golfers' abltes and ther performance n the years 1995, 2000, 2005, and We fnd that for all years n queston the varables that are tradtonally assocated wth performance are statstcally sgnfcant and have the expected sgns. Ths s wth the excepton of the PUTT varable, whch n 2009 had a counterntutve postve sgn for three-quarters of the golfers beng studed. In ths case we have found a structural change n the effect of the PUTT varable on the logarthm - a result whch has not been documented n other studes. Ths may be due to the ndrect relaton between golfers' sklls and ther. As suggested by Scully (2002), golfers' sklls result n low scores, whch are n turn awarded wth przes. Ths mples an ndrect relaton or equaton system that we wll analyze n future artcles. Wth respect to what sklls are most worth mprovng, results show that n the last decade t was better to mprove n drvng than n puttng. In terms of effcency, the two measures that we have used both descrbe Phl Mckelson as the most effcent golfer n In future research we wll delve further nto the counterntutve behavour of the PUTT varable n samples startng n 2009 and changes n returns that occur n the sample years for the dfferent sklls that characterze a golfer's performance. ENDNOTES 1. Prze money was deflated usng the Unted States Consumer Prce Index so as to be expressed n 2009 equvalents. 2. In order to save space, only the results from the 2009 sample are reported here. 3. Ths would mean decreasng the on-green puttng average by REFERENCES Nero, P. (2001). Relatve salary effcency of PGA Tour golfers. Amercan Economst, 45, no. 2: Rnehart, K.L. (2009). The Economcs of Golf: An Investgaton of the Returns to Skll of PGA Tour Golfers. Major Themes n Economcs, Sprng, Callan, S.J. & Thomas, J.M. (2007). Modelng the Determnants of a Professonal Golfer s Tournament Earnngs. A Multequaton Approach. Journal of Sports Economcs, 8, no. 4: Moy, R.L. & Law, T. (1998). Determnants of professonal golf tournament. Amercan Economst, 42, Scully, G.W. (2002). The dstrbuton of performance and n a prze economy. Journal of Sports Economcs, 3, no. 2: Shmanske, S. (2008). Sklls, Performance, and Earnngs n the Tournament Compensaton Model: Evdence From PGA Tour Mcrodata. Journal of Sports Economcs, 9, no. 6: \ APPENDIX 1: HETEROSCEDASTICITY TESTS The Breush-Pagan test was carred out for each of the models. In all cases, tests whose alternatve hypotheses meant that an explanatory varable was causng the heteroscedastcty problem and that all the explanatory varables caused the problem were performed. Results are presented n Table 9. In no case dd we fnd evdence of a heteroscedastcty problem. Fnally, Table 11 presents the results of a Goldfeld- Quandt test for all estmated models. In ths case, there was also no evdence of a heteroscedastcty problem. 130 Journal of Appled Busness and Economcs vol. 14(1) 2013

12 TABLE 9 BREUSH-PAGAN TESTS FOR THE ESTIMATED MODELS. Model Sample Ha: s =f() Statstcal-t p- value DRIVE PUTT Events SAND DRIVEACC * ALL DRIVE PUTT Events SAND DRIVEACC ALL DRIVE PUTT Events DRIVEACC ALL DRIVE PUTT Events SAND DRIVEACC ALL * DRIVE PUTT SAND DRIVEACC ALL DRIVE PUTT Events SAND DRIVEACC ALL DRIVE PUTT SAND DRIVEACC ALL Note: (***), (**), and (*) mply rejecton of the null hypothess of homoscedastcty wth sgnfcance levels of 1%, 5%, and 10% respectvely. Journal of Appled Busness and Economcs vol. 14(1)

13 TABLE 10 WHITE TEST FOR ESTIMATED MODELS Model Sample Statstcal-t p-value TABLE 11 GOLFELD-QUANDT TEST FOR ESTIMATED MODELS Model Sample Ha: s =X s Statstcal-t p-value DRIVE PUTT Events SAND DRIVEACC * DRIVE PUTT Events SAND DRIVEACC DRIVE PUTT Events DRIVEACC DRIVE PUTT Events SAND DRIVEACC DRIVE PUTT SAND DRIVEACC DRIVE PUTT Events SAND DRIVEACC DRIVE PUTT SAND DRIVEACC Note: (***), (**), and (*) mply rejecton of the null hypothess of homoscedastcty wth sgnfcance levels of 1%, 5%, and 10%, respectvely. 132 Journal of Appled Busness and Economcs vol. 14(1) 2013

14 APPENDIX 2: NON-NORMALITY TESTS FOR ERRORS Table 12 presents four tradtonal normalty tests. There s no evdence that allows for rejectng the null hypothess of normalty for the estmated resduals n any of the models. TABLE 12 NORMALITY TESTS FOR THE RESIDUALS IN ESTIMATED MODELS Shapro-Wlk Kolmogorov-Smrnov Pearson ch-cuadrado Jarque Bera Model Sample Statstcal-t p-value Statstcal-t p-value Statstcal-t p-value Statstcal-t p-value * * * ** * *** Note: (***), (**), and (*) mply rejecton of the null hypothess of normalty wth sgnfcance levels of 1%, 5%, and 10%, respectvely. APPENDIX 3: EFFICIENCY ANALYSIS FOR THE YEARS 1995, 2000, AND 2005 TABLE 13 THE TEN MOST EFFICIENT GOLFERS IN 1995 Player Actual Expected Boundary Effcency Blly Mayfar 2,172, ,745 2,172, D.A. Webrng 727, , , Corey Pavn 1,886, ,316 2,063, Mark Webe 237,669 71, , Tom Lehman 1,168, ,855 1,487, Scott Smpson 1,120, ,955 1,516, Mark O'Meara 1,286, ,437 1,751, Jm Furyk 753, ,220 1,046, Marco Dawson 367, , , Lenne Clements 499, , , Journal of Appled Busness and Economcs vol. 14(1)

15 TABLE 14 THE TEN LEAST EFFICIENT GOLFERS IN 1995 Player Actual Expected Boundary Effcency John Huston 414, ,903 3,954, Tommy Armour III 189, ,839 1,903, Fuzzy Zoeller 240, ,537 2,476, John Daly 452,932 1,239,530 4,907, Tom Watson 451,576 1,271,445 5,033, Doug Tewell 64, , , Bob Burns 83, , , Carl Paulson 90, ,434 1,082, Fulton Allem 76, , , Tm Loustalot 24, , , TABLE 15 THE TEN MOST EFFICIENT GOLFERS IN 2000 Player Actual Expected Boundary Effcency Carlos Franco 1,931, ,967 1,931, Duffy Waldorf 1,724, ,266 1,808, Hal Sutton 3,814,129 1,125,578 5,214, Crag Stadler 787, ,272 1,131, Frankln Langham 1,999, ,465 2,971, Scott Hoch 1,705, ,762 2,584, Vjay Sngh 3,206,637 1,120,530 5,191, Tom Lehman 2,577, ,378 4,426, Stewart Cnk 2,703,175 1,005,985 4,660, Gary Ncklaus 503, , , TABLE 16 THE TEN LEAST EFFICIENT GOLFERS IN 2000 Player Actual Expected Boundary Effcency Aaron Bengoechea 75, ,065 1,251, P.H. Horgan III 100, ,002 1,672, Casey Martn 178, ,636 3,042, Ted Tryba 310,763 1,191,446 5,519, Davd Frost 188, ,177 3,359, Sergo Garca 1,313,557 5,441,909 25,212, Crag Bowden 42, , , Keth Nolan 57, ,764 1,393, Nck Faldo 344,584 2,199,156 10,188, John Daly 143,847 1,500,564 6,952, Journal of Appled Busness and Economcs vol. 14(1) 2013

16 TABLE 17 THE TEN MOST EFFICIENT GOLFERS IN 2005 Player Actual Expected Boundary Effcency Chrs DMarco 3,913, ,062 3,913, Bart Bryant 3,569, ,427 4,284, Tm Petrovc 1,879, ,544 2,282, Brad Faxon 1,868, ,163 2,274, Padrag Harrngton 2,873, ,212 3,550, Fred Funk 3,108, ,832 4,016, Adam Scott 2,847, ,592 3,754, Peter Lonard 2,084, ,215 2,898, Davd Toms 4,352,270 1,099,440 6,345, Jm Furyk 4,674,522 1,250,446 7,216, TABLE 18 THE TEN LEAST EFFICIENT GOLFERS IN 2005 Player Actual Expected Boundary Effcency Larry Mze 227, ,719 4,973, Wll MacKenze 302,669 1,155,828 6,670, Jose Coceres 296,271 1,146,451 6,616, Maro Tzan 199, ,034 4,975, Charle W 274,714 1,207,851 6,971, Brenden Pappas 306,855 1,596,211 9,212, Mchael Long 198,189 1,056,754 6,099, Bradley Hughes 84, ,439 3,026, John Ellott 74, ,758 2,843, Hdeto Tanhara 69, ,660 2,976, Journal of Appled Busness and Economcs vol. 14(1)