Thursday, December 6, 2012

Age and the Inverted U: Player Age and Transfer Market Valuations

Timeless beauty?
Some things, like a good wine, get better with age. Footballers do, too, but unfortunately only up to a point. Even in the era of Giggs, Scholes, and Friedel, no matter where athletes do their work, they will eventually see a decline in performance. If that's true, and if we assume that a player's performance is linked to his market value, both should increase during the first half of a player's career and decline thereafter.

But is that really the case? And if it is, where exactly is that turning point – the time at which players become more and less valuable? One way to answer that question is examine their performance; another way is to see what the market says. It's the latter we focus on here. We wanted to know: what is the connection between a player’s age and the price he can command?

To answer these questions, we collected data from the respected Transfermarkt website for all players currently on Premier League squads and performed a variety of calculations on their transfer values (complete data were available for a total of 502 players; we collected these data in early October).*

As in our previous analyses, we estimated a set of of regression models with the aim of accurately predicting a player’s valuation based on a variety of factors, including things like position, nationality, club, contract length, experience in the league, and so on. But critically, we also included two variables to assess the influence of a player’s age on his valuation – the actual age, to capture any linear trend in age and age squared, to see if the connection between age and valuation is curvilinear.