This thesis from the business-economics faculty of two American universities was a fascinating look into who gambles and who plays it safe on par 5’s on the PGA tour. Given that all money-leaders on tour over the past decade have either won or ranked top 5 for par 5 scoring, getting this balance right has obvious benefits. It also looks at the “Superstar” effect of having Tiger Woods in the field between 2004 and 2009 when he was at his best and how this also affected the risk-taking strategies of other players.
Risk Taking Dynamics in Tournaments: Evidence from Professional Golf
Todd McFall Department of Economics Wake Forest University & Kurt W. Rotthoff Stillman School of Business, Seton Hall University, Spring 2016
Professional golfers can differ in their risk-taking and loss-aversion behaviour on the golf course in relation to shot selection. Generally speaking this is more noticeable on par 5’s, especially with the second shot approaching the green. Retrospectively analysing 10 years of PGA Tour Shot Link data between 2004 and 2014 – including 3 major tournaments each year, the researchers were able to determine statistical trends in how players behaved with their second shots on the par 5 holes. Over 458,000 par 5 holes were analysed.
Players were more likely to play it safe (similar to loss aversion in the economics world) on par 5’s when the purses were bigger ($US10million compared to $US4million) or when they were placed at or above their world ranking level in the field on the final day. Players also tended to play it safer on the first 3 days of the tournament. Conversely more risky shots were used by players if they were 50 places or more below their expected place in the field (based on world ranking), were longer drivers of the ball or were in contention on the last day. Amazingly, having Tiger Woods in the field on the last day meant all players in the field were more likely to take on risk on the par 5’s.