NFL Draft: Will The New Rookie Wage Scale System Lead to More Trades?

NFL Draft: Will The New Rookie Wage Scale System Lead to More Trades?


NFL Draft: Will The New Rookie Wage Scale System Lead to More Trades?

There seems to be a growing consensus that there will be more trades in this draft because of the NFL’s wage scale system, which was officially adopted in July, and was first used on 2011 signees. I’ve seen former general managers and current ones say that it will increase trading. Numerous pieces this week have been written about the likelihood of more trades, such as here, or here, or here.

I’m not so sure. No doubt the change at the very top of the draft has perhaps loosened teams to  trade in the top five picks, and we saw the blockbuster Robert Griffin III trade earlier this offseason. However, I have also heard people talking about how the draft value chart is now obsolete. I talked about that draft value chart earlier this offseason, and how it was really based on just a few top trades over a short period, and didn’t necessarily adequately reflect historical performance differences at the top.

However, that draft value chart and its widespread adoption had one major effect throughout the league–it provided a common currency language for the quick negotiation of draft day trades. If you wanted to make a trade, you had a sense of where you would need to be to get it done. Then you decided if you wanted to pay the going rate.

Here’s a summary of all trades in the offseason leading up to and including draft day trades, for three different ten year periods. I’ve divided it into three groups- top five picks, picks 6-15, and picks 16-30. A trade was categorized by the best draft pick included in the trade in that given draft year. So, for example, the Julio Jones trade from last year would be included in picks 6-15 only (and not pick #26, which the Falcons traded, nor would the future pick be counted in future years).

So, what did we see? Remember, the draft value chart was developed by the Cowboys before the 1991 draft. It disseminated through the league over the next decade. There were actually fewer trades in the 1980’s, though there were more trades among the very top picks. Trades during that decade tended to involve veterans and also tended to dabble in future picks much more. However, they did not pull as many draft day trades.

In the 1990’s, teams still continued to trade top draft picks while also increasing the number of other first round trades. In the last decade, with escalating salaries, the top five trades dried up. The economic language of the draft value chart allowed for easier negotiation on other trades. At the top, that same language led to paralysis. The prospective buyers knew the price was too high given the cost of the asset. The prospective sellers, though, were hide-bound to demand those prices. However, first round trades exploded in the latter half of the first round–almost five per year from picks 16 to 30.

We’ve seen the Griffin trade, but it could actually have a chilling effect. Not everyone is trading up with that conviction and for that position and player. However, potential sellers may see that as setting some sort of market for early picks. The drastically increased surplus value has also dried up veteran player trades this offseason, something that usually leads to a few more first round trades once the draft order is known. Teams know the picks are more valuable, but they are not quite sure how to value it.

To get a deal done within ten minutes, you need a common language that allows for quick shortcuts in negotiation. With many teams saying the chart is obsolete, I’m concerned that their might be a language barrier. Last year, when teams knew a wage scale was coming (even if they didn’t know the exact final details), they only made 4 first round trades, a below average amount compared to the last decade. You will see some trades this year, but remember, we have averaged over 7 in the first round over the previous decade when everyone used the “draft value chart.” We’ve still got 6 to go just to get to average.

[photo via US Presswire]


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