МАГИСТЕРСКАЯ ДИССЕРТАЦИЯ MASTER THESIS Тема: Договорные матчи в советском футболе: миф или реальность? _____________________________________________________________ Title: Cheating in Soviet Football: Myth or Reality? _____________________________________________________________ Студент/ Student: Sergey Vorontsov (Ф.И.О. студента, выполнившего работу) Научный руководитель/ Аdvisor: Ruben Enikolopov, Irina Khovanskaya, Maria Petrova and Konstantin Sonin (ученая степень, звание, место работы, Ф.И.О.) Оценка/ Grade: Подпись/ Signature: Москва 2011 Sergey Vorontsov1 Cheating in Soviet Football: Myth or Reality? Abstract Establishing unfair behavior in sports through econometric analysis of results is a quite challenging task of extracting hidden information from publicly available data only, as it can be seen from fascinating work on cheating in sumo championships by Mark Duggan and Steven Levitt (2002). In this paper, the USSR football premier league is investigated with basic hypothesis being that a football club from the capital of the Ukraine, FC Dynamo Kiev, enjoyed support from other Ukrainian teams in form of fixed matches. An ordered probit model for the outcomes (win, draw or defeat) of matches of Dynamo Kiev is estimated controlling for the strength of the teams, home/away games, and year and Ukrainian team fixed effects. The results suggest that its overperformance in successful years against Ukrainian teams is higher than against other rivals, which favors the original hypothesis. The effect becomes statistically significant when the sample is limited to the most recent part of the sample. Also, it is found that the introduction of new Politburo members could actually increase the performance of teams from their native cities. 1 The author is grateful to his advisors – Ruben Enikolopov, Irina Khovanskaya, Maria Petrova and Konstantin Sonin – for their unlimited patience, inspiring advice and valuable comments. Also, discussions and suggestions by Kirill Borusyak, Andrei Bremzen, Oleg Groshev, Sergei Guriev, Sergei Izmalkov as well as thoughtful questions by seminar and conference participants at NES are thankfully acknowledged. 1 Introduction While sports are not usually of direct economic interest, they draw researchers‟ attention as they allow investigating strategic behavior of individuals and organized groups of people. Among advantages of sports as object of research are strict and clear rules, readily available data and wide variety of games existing. It has become quite common in literature to address behavioral questions through analyzing sport results. Vincenzo Scoppa (2008) finds that football referee decisions may be biased towards the home team, mostly due to the social pressure by supporter crowds. Pierre-André Chiappori et al. (2002) find an appropriate phenomenon – football penalty kicks – to analyze mixed strategy equilibria in real life. Another interesting problem to look into is cheating in sports. This work investigates a case of USSR football championship. It was a common opinion among Soviet supporters that trading matches, especially involving teams with no tournament motivation left of, conversely, teams struggling to stay in the premier league. However, such cheating patterns can hardly be distinguished from the case when simply higher motivation induces higher effort. A prominent paper by Mark Duggan and Steven D. Levitt (2002) seems to have succeeded in this challenging task. They looked into corruption among Japanese elite sumo wrestlers. There incentives for trading matches arise due to non-linearity in prize structure (eighth out of fifteen possible wins in a tournament brings more marginal value in terms of rating and prize money than others do). The authors find that wrestles on the margin for their eighth victory perform significantly better than on average. To provide evidence consistent with the hypothesis that cheating, but not effort is responsible for that, they use several quite creative techniques, some of them are listed below. First, after winning on the margin the player has lower than average probability of victory in the next match against the same opponent. This suggests that a mechanism of match exchange exists. Second, signs of match fixing disappear in the years of media scandals on sumo corruption. Finally, two former wrestlers declared some of sportsmen not corrupt and those really did not show the common cheating pattern. Unfortunately, these all tricks are almost impossible to implement when analyzing football, primarily because of small number of matches – only two games per year between each pair of teams. However, match fixing of political nature can still be found. This paper makes an attempt to confirm the allegations of throwing matches to the club from the capital of Ukraine, Dynamo Kiev, made against other Ukrainian teams. Such behavior should maximize the probability of Dynamo Kiev and could possibly be promoted and protected by highly influential Ukrainian politicians (members of Politburo). Though the rumors on Dynamo Kiev‟s unfair play are quite common among supporters, even anecdotal evidence of politically conditioned match fixing is hard to find. In an interview to a Ukrainian paper, Dynamo Kiev‟s player Viktor Serebryanikov admitted that they were occasionally involved in match fixing, but did not mention any motives other that just financial. Hence, this work can not only contribute to methodology of cheating detection but also shed light on an interesting historical case. An ideologically relevant paper on politically motivated cheating in sports by Charles C. Moul and John V. C. Nye (2009) has investigated possible collusions of Soviet chess players. The hypothesis tested there is that players from the USSR deliberately drew matches (exerted less effort and spent less time) against each other to focus attention on other games thus maximizing the probability of a Soviet player winning a tournament. However, more complicated strategic patterns, such as throwing matches to a Soviet player who showed himself most successful against favorites from other countries, were not looked into. Again, part of the success of the paper is due to the quality of data: the same grand masters play against each other quite often, and a widely accepted rating system exists. Both of these features are not inherent in football championships making the problem of this work quite challenging with respect to that about chess. This paper suggests the following methodology: compare the increase in performance of Dynamo Kiev in its successful years against Ukrainian and all other teams. Assuming that with more chances of Dynamo Kiev winning a championship there should be more fixed matches against Ukrainian clubs, the positive sign of the interaction between rival being from the Ukraine and the season being successful would support the hypothesis of Dynamo Kiev‟s cheating. The positive sign is indeed observed, controlling for the strength of the teams, home/away games, and Ukrainian team and year fixed effects. In placebo tests, the specification is faked by substituting Dynamo Kiev and Ukrainian teams for Dynamo Moscow and other relevant groups of teams, either one at time or both. The results of those tests turn to be ambiguous, and hence, while data is consistent with Dynamo Kiev‟s fixing matches, the team cannot be decisively accused of unfair behavior basing on statistical investigation only. Also, the paper tries to detect the direct influence of politicians on teams‟ performance. Places of birth of Politburo members are used to predict the teams they could favor. A small (but statistically significant) positive effect on the performance of “native” teams is actually found in the seasons after the introduction of new members. This finding does not explicitly help understanding how Dynamo Kiev could organize fixed matches with other Ukrainian teams, but at least provides some empirical justification for the discussions of possible political reasons behind the statistically revealed cheating, such as of Moul and Nye (1999) or of this thesis. The rest of the paper is organized as follows: Section 2 formulates the hypotheses to test, Section 3 describes initial data as well as construction of specific variables, Section 4 presents and discusses the results of empirical analysis, and Section 5 concludes. 2 Hypotheses Two hypotheses are analyzed in the paper. One is that FC Dynamo Kiev enjoyed support of other Ukrainian teams in form of fixed matches. Assuming that there were more incentives for cheating in seasons when Dynamo Kiev was a real contender for the USSR championship title, the hypothesis implies that in those seasons an increase in Dynamo Kiev‟s performance relative to other seasons is larger against Ukrainian teams than against others. This particular implication is tested in the paper. The other hypothesis that is investigated can be generally formulated as follows: politicians could affect the results of football matches and teams‟ performance directly. More specifically, it is tested whether the introduction of new Politburo2 members increased performance of the teams that could be labeled as “native” to these members, if any. 3 Data Methodology for both hypotheses includes estimating probabilities of outcomes of matches, either played by Dynamo Kiev (for the first hypothesis), or by any teams (for the second one). Match results and calendars of 1963 – 1968, 1970 – 1975, 1977 – 1991 USSR football championships are taken from online database WildStat, in