A comprehensive approach to predict auction prices and economic value creation of cricketers in the Indian Premier League (IPL)

Abstract

The Indian Premier League (IPL), the most successful cricket tournament in India, has immensely grown in popularity. Unlike similar tournaments like Major League Baseball and the UEFA Champions League, their models cannot be replicated due to the dynamic pricing nature of player auctions. The research intends to generate a predictive model that predicts the auction price of a player using key quantitative variables. The players were categorised by batsmen, bowlers, and all-rounders. Due to the holistic hedonic nature of the model, equations were formed to predict a player’s future performance, in terms of measurable points, and to extrapolate economic value creation given a budget constraint. This study provides insights on the player’s economic value by comparing the auction price paid vs. the player’s actual performance. This new approach to modelling in cricket games not only aims to produce more accurate results using the hedonic pricing method, but also enlightens an introduction to a more holistic modelling process to intricately understand the profiting avenues for team owners to reverse-engineer value additions of players at each level and position. Finally, this model, which considers the factors an IPL franchise would, is being designed to be utilised in future IPL auctions.