Economics of Steroid Use

Interesting commentary on the economics of banning steroids as opposed to permitting anything-goes doping and steroid use in sports. I previously pondered the question (although not from an economic perspective) of why steroids should be banned, and got some very thoughtful comments, here.

Dave Hoffman at Concurring Opinions looks for an economic justification. He concludes, tentatively, that the social ills (particularly fan dissatisfaction) associated with steroids and doping are connected to monitoring for performance-enhancing drugs, not the use of drugs themselves. That is, if the leagues were not monitoring and exposing drug use, but allowing all the players to do what they could to play better, fans actually would be happier (assuming the drug-enhanced players were on their teams) by the benefits of improved performance. The costs of steroid use disappear if we do not know what the players are doing and only that they are improving on the field. The lone remaining cost is to player health, but Hoffman discounts that because players can control whether and how they choose to play along.

Dave then calls on his readers to make the economic case for or against anything-goes.

Randy Picker of the University of Chicago Faculty Blog makes the case against. Picker argues that the competitive advantage of doping disappears if everyone is doping. Competitive success is relative rather than absolute, thus the game looks exactly the same, competition-wise, if everyone is using enhancers. Except now we get the same level of competitive play combined with the potential and real physical harms associated with steroid use. So anything-goes yields 1) a no-better (in terms of competition) game and 2) worse-off players. That, he says, is an inefficient economic trade-off.

I agree with Picker's point as to relative competition and it is the first time I have seen the point made.

But is there an aspect of absolute competition, for which # 1 above may not be true? Is "the game" played by equally competitive drug users "better" than the game played by equally competitive non-users? An equal game played by "clean" players yields 61 homers as a season record, 755 homers as a career record, and 383 strikeouts as a season record. An equal game of enhanced players might yield 80 homers in a season, 800 in a career, and, say, 450 strikeouts in a season. The players are on a level playing field, but the level is higher than without steroids because the quality of the "human equipment" is better. To the extent we hold numerical records dear, this is another argument against anything-goes (the records are "tainted"). To the extent we want an overall better game (as indicated by numerical records and overall achievements beyond wins and losses) and steroids gives us that, might it then overcome the health trade-off?

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