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UNC KENAN-FLAGLER NEWS


Topping the Leaderboard in Golf Research

11/16/2012

Recently featured in Golf World magazine and The Wall Street Journal, the research of Richard Rendleman (Ph.D. ’76), professor emeritus of finance at UNC Kenan-Flagler, may someday change the way that the Official World Golf Rankings (OWGR) are calculated.

Rendleman, currently a visiting professor at the Tuck School of Business at Dartmouth, has been collaborating with colleague Mark Broadie, the Carson Family Professor of Business at Columbia Business School, on the research. “Casually, Mark and I discussed the commonly-held belief that the OWGR is biased against the PGA TOUR and decided it would be interesting and important to see if, in fact, there is a bias,” says Rendleman.

“Despite what has been written, we have not devised a new system. Instead, we developed an unbiased statistically-based benchmark against which we can estimate potential bias in the current system. Statistically, there is nothing special about our model. The same general method has been used in countless applications in finance, economics, accounting and more generally in the social and hard sciences.”

According to Rendleman and Broadie, there are several problems with the current system.

“Each of the worldwide tours has a specifically-designated flagship event. One small bias is that the flagship events for some of the lesser tours get too many pre-determined OWGR points relative to the strengths of their fields,” Rendleman explains. “A more important factor is that each tour is awarded a minimum number of points to its tournament winners. In 2010, the winner of the European Tour’s Madeira Islands Open, which included only one top-200 player, earned the same number of points as the fifth-place finisher in a major. Clearly, these are not comparable accomplishments.”

“Notwithstanding the above, OWGR points awarded to each event worldwide depend upon the number and mix of top-200 players in the field. If the OWGRs of players on a particular tour become favorably biased, they tend to stay favorably biased, because they bring too many OWGR points to the events in which they play.”

Ultimately, Rendleman hopes that this research will change the current ranking system: “We just want the system to be fair. We would like to see the OWGR adopt a new system that is unbiased with respect to any tour.”

“Although many golf fans focus on the top position in the OWGR, we are actually more concerned with the players who are ranked around position 50, the cutoff for eligibility in most of the majors and World Golf Championships. Our work shows that if you were to take two equally-skilled players whose skill ranks were close to 50, and one was a PGA TOUR player and the other does not play on the PGA TOUR, the PGA TOUR player’s OWGR will be around 46 ranking positions worse than that of the non-PGA TOUR player. Obviously, that is something we would like to correct.”

For more information on Rendleman and related media highlights, visit the websites below:

Tuck School of Business at Dartmouth

Golf World

The Wall Street Journal