Monty Williams’ Loss Aversion May Be Causing Losses

Published: January 8, 2015

As part of my resolution to expand my so-called game here on the site, I’m going to try to talk a little more about the on-court play of the New Orleans Pelicans.

Right now seems the perfect time to talk about losses and why they happen, or at least one reason. The team just dropped a seemingly very winnable game the now 13-24 Charlotte Hornets, leaving the Pelicans at 17-18. Losses will happen, even against short-handed teams in the East, but it’s time to take a look.

The other day, I ran across this quote from Monty Williams that Jimmy Smith of the Times-Picayune had in his article on Asik’s pro-Spurs tip in:

“We had the game won in overtime,” Williams said, “and get beat on a backdoor play we’ve seen San Antonio run for 20 years.”

Yet Williams admitted he has replayed the sequence repeatedly since Wednesday night, wondering whether he should have told Davis to get closer to Diaw’s inbounds pass, or switching Asik and Davis, who has better leaping ability than Asik.

“You can sit there and try to figure out all the stuff you want to,” Williams said. “We had a chance to bat the ball away and that’s all you can ask for. I wish I had mulligans on every play.

“I’m always looking at ways where I can keep my players out of positions where they fail or things don’t go well. But you can’t live in second-guessing. That, to me, is the last thing you want to do as a head coach. You’ve got to think about it for a while and move on.”

It’s the last bit that interests me here. I give the full context so you can see how it came out. It was not a response to a question about a coaching philosophy. Rather, it was a question how the game was won and lost that Coach answered first. When asked about the could-have / should-have of it all, he side-stepped in the same way every coach worth his salt would, which is to say something along the lines of, “We had as good a chance as we could get, but it did not work out.” Process v Results.

Then, having answered the question, he continued to talk about something pretty specific to his thinking, and something that runs counter to the paragraph before. This, to me, actually seems like a moment of candor, as opposed to the party line, a throw away line from the book of coachspeak, or the guarded conversations normally have (and rightly so) with the media. He goes from reacting to the question about how the situation could have been avoided by pretty much saying “don’t do that” to saying “I do that.” Let’s read just that bit again:

“I’m always looking at ways where I can keep my players out of positions where they fail or things don’t go well. But you can’t live in second-guessing. That, to me, is the last thing you want to do as a head coach. You’ve got to think about it for a while and move on.”

The phrasing choice here could be arbitrary or unintentionally misleading. He could be saying that it is his job to question plays and not that of the media (“Stay in your lane, media!”). He could have just talked mistakes for some random reason instead of mentioning successes.

What Coach says, however, is that he is trying to avoid mistakes. As I pondered this unprompted pseudo-non-sequitur, it occurred to me that Monty may have the human, all too human malady of Loss Aversion.

Loss Aversion is a psychological / economic concept that explains certain decisions people make. In short, on average, the influence of a potential loss is about twice as powerful as the influence of a potential gain of equal size.

Example: You are walking around the Quarter with $100 in your pocket. You can play a game offered by a street merchant. In this game you can pay $1 and flip a coin. If the coin comes up heads, you get your $1 back plus some. If you lose, the vendor keeps the $1. You have every reason to suspect he game is not rigged, and you can only play once, per the rules of the merchant.

Unless that “plus some” is something like a dollar or more, many people will not play that game, a game that actually, in the long run, will bankrupt the vendor just through net payouts. Purely mathematically, the payout just has to be $1 to make the game fair and anything extra actually favors the the player, not the merchant. Data supports the decision-making is in line with loss aversion, and that people choose to play only if the payoff is a bit higher than the loss, again, around twice as much. Additionally, this is not a “make it worth my time” thing. It’s about the aversion to loss.

To be perfectly clear: This is irrational for the most part. Arguments can be constructed in certain situations that Loss Aversion is the proper mode of decision-making, such as if you only have $1 rather than $100 in the example above. In the large, it’s irrational. The irrationality just means that factors outside of the pure wins, losses, and probabilities enter into the decision-making. It does not mean insane or stupid. Love is irrational. Caring for a child or a pet is irrational. Following your sports team is likely irrational.

Not bad.


I could go on for thousands of words here, but I won’t. I’ll save them for many more articles.

I will, however, give a couple of pieces of evidence / analysis for you to ponder yourselves, discuss, or counter-argue.

  • Coach has been known not to give players, particularly young players, much time after making a mistake. This could very well be a rational Loss Aversion instance, since a developing player could react very negatively to being thoroughly outplayed by being placed in a situation that they are just not capable (at the time) of succeeding. Similarly, we’ve seen worse veteran players get minutes over younger players who we not known commodities but had upside.
  • The Pelicans’ slow pace of play and long waits before initiating the offense can both be explained in terms of Loss Aversion. Slower pace can be viewed as attempting to have fewer possessions for each team. This limits mistakes by limiting opportunities. Additionally, by setting and observing, one could conclude that offense will be less likely to be tricked into a disastrous action. They may not be able to capitalize on the mistakes of the defense, but that is viewed as worth the cost (clearly, since this is what happens). Going back to pace, if you lessen the number of possessions for your opponent, you lessen the number of opportunities they have to score. This comes at the expense possessions for your own team to score, of course. Again, this is trading upside for avoiding loss (here, an opponent scoring). This could very well also explain the 2-for-1 choices the team makes. Taking a quick possession if you get a good look, leaving the opponent a full shot clock, then having a shot clock of left to get a good look is going 2-for-1. Not going 2-for-1 can be explained in terms of loss aversion by trying to not leave the opponent a full shot clock with which to work.
  • Coach does not like to take a timeout when the Pelicans are in a potential game-winning situation and gain possession while the opposing team has their offensively minded players in the game. The audio here (start at about 1:20, and the relevant bit goes on for about 45 seconds) has Coach describing the Tyreke Evans three-point-shot attempt near the end of overtime in the New Year’s Even Spurs game and what led up to it. He points to the opposition getting set, getting a look at your plays, cites cases where it’s worked in the past, restates that people should not second guess, and that he’ll “live with everything that they do,” they being the players. In this, Coach seems to exhibit the Endowment Effect, which is similar to Loss Aversion. The Endowment Effect is when one of two equally-valued items or a lesser-value item is preferred because it is in one’s possession irrationally. Here, the current lineups for each team takes the place of the item in possession. The Endowment Effect is explained by Loss Aversion. Here, the prior successes and aversion to a mistake in coaching (e.g. lineups, play drawn up) leads Coach to live with that situation. It should be noted that this run exactly counter to the bullet above. Remember, this stuff is irrational, so this is possible.

A couple of things before I end this.

First, this is not Monty-bashing. This is trying to understand not just his actions but his coaching values. This is placing his actions and statements in a context after giving them attention. Similarly, it is not Monty-praising, Monty-excusing, etc. It’s trying to make sense of the play on the court.

Second, Loss Aversion is not bad. It can be helpful or harmful, but it is often irrational. The other side of this is that the aversion to losses causes one to sacrifice bigger wins (by definition). It is likely this point that has many fans and writers gnashing their teeth at times.

What the long-term prospects for Coach or the New Orleans Pelicans is if this Loss Aversion thing is basically true, and it may be that Coach is steering the team on the right path or the wrong path. The topic here, however, is the extent to which Loss Aversion explains Coach’s actions.

What say you?


  1. Littlewing745

    January 8, 2015 at 11:42 am

    While this is an interesting idea and an interesting read…every single thing you pointed to could also be called, “bad coaching.”

    When Byron Scott didn’t (and still doesn’t) play young guys after making mistakes? Bad coaching. Same was true with Larry Brown.

    When players are forced into the wrong offense – be it uptempo, halfcourt, too many isos, etc. – we call it bad coaching. Thinking Mike Brown here, for example.

    Consistently calling timeouts at the wrong time – if at all – is referred to in pretty much every sport as “poor clock/TO management,” which again…is bad coaching.

    I think, instead, we should substitute every instance of “Loss Aversion” in this article with “bad coaching,” and it’ll make far more sense to everyone. Including in the headline. That’s just my two cents.

  2. MCMaxJD

    January 8, 2015 at 11:45 am

    I find it interesting to take a look at Montys mental mindset but I don’t think it all falls on any one decision but truly an overall lack of confidence and fire. Ask yourself when the last time Monty argued a call against our team and got a technical? He is a great coach… Just not a head coach, he would make an amazing assistant coach because he has the skills and forms good bonds with his players but he his too passive. This is a contagious way of being, let’s just take a quick look at Jrue, he’s having a decent year averaging almost a double double but his voice isn’t a driving force he as a point guard needs to be our leader. This is a direct reflection on the environment Monty has created. Jrue was more of a leader in Philly during his Allstar year. Maybe we need a change, just look at Detroit and Stan Van Gundy, “we need to form a f**king wall, that’s all we need to do” that may be funny and too blunt but it was effective and got them the win. Basically what I’m saying is consistent with the old saying ” you can lead a horse to water but you can’t make him drink it” yes, but if we aren’t leading the horse or In this case the Pelicans then they will never have a chance to drink that water we spoke of..

  3. bigezking

    January 8, 2015 at 2:42 pm

    Please Mr. Benson, fire this man and hire a proven experienced NBA coach.

  4. Jason Calmes

    January 8, 2015 at 4:12 pm

    Littlewing745 Much of what you say here is quite vague. What I said was quite specific. I’m sure how being vague is an improvement. 
    “Bad” coach. Ask Ryan Anderson if Monty is a bad coach next time you see him, because Monty spent Ryno’s darkest night with him. And how about Team USA recognition? 
    Monty may have many flaws, but “bad” doesn’t help discern what the good and the bad points are. If you aren’t interested in that, that’s fine, but I am, which is why I was quite specific.

  5. Jason Calmes

    January 8, 2015 at 4:15 pm

    MCMaxJD I’m having trouble understanding your concern here, other than the techs. Tell me what number of techs he should have, give or take. We’ll see if we can check that against some other coaches.
    I also do not see anything here about the topic.

  6. Jason Calmes

    January 8, 2015 at 4:17 pm

    bigezking Do you actually have anything to add?

  7. adfly

    January 8, 2015 at 5:12 pm

    I think I understand what you’re saying. Monty focuses to much on limiting mistakes and it kind of forces the team to play tight. I think that explains why the tempo isn’t where it should be along with the 2 for 1 thing.

  8. nova fan

    January 8, 2015 at 5:23 pm

    Interesting. But just what is the writer’s definition of “rational?” It may differ from others’ views.

  9. wilthomas178

    January 8, 2015 at 5:41 pm


  10. Jason Calmes

    January 8, 2015 at 6:23 pm

    Good question. I define it in terms of irrationality and give examples in that context. From the post:
    “The irrationality just means that factors outside of the pure wins, losses, and probabilities enter into the decision-making. It does not mean insane or stupid. Love is irrational. Caring for a child or a pet is irrational. Following your sports team is likely irrational.”
    It’s me trying to paraphrase the typical economics sense of the term. For example, in the sense of a 2-for-1 possibility, a rational “consumer” of possessions would do what maximized expected point differential in a close game regardless of the manner of doing so (within the rules). Irrationality comes in when options are preferred or discounted for others reasons. Loosely.

  11. Littlewing745

    January 8, 2015 at 6:30 pm

    Jason Calmes Littlewing745 Well, I should preface this comment by saying that I am not writing a column, therefore I did not feel it necessary to provide the level of specificity that a column would require. I’m happy to oblige, however, to the best of my ability.
    Brief response to the Ryan Anderson point: it’s true that Monty was there for Anderson, and it was a truly wonderful thing for a him to do as a human being. However…it didn’t translate to wins, player development or in-game strategy. 
    I’ll *very* hesitantly acquiesce the Team USA point, though I think there’s definitely an argument to be made that the strongest qualification on his resume was “Anthony Davis’s coach.”
    At any rate, to the meat of the issue: the “bad” things to which I’m referring. I apologize for not expounding initially, but I thought it was clear that I was expanding upon YOUR examples. You attribute the examples you gave to loss aversion; I view them as multiple examples of his poor coaching – unfortunately across many facets of the game. I think we’re both entitled to our opinions, but let me more thoroughly defend mine.
    In order from above:
    – You refer to Monty’s disinterest in playing young players who make mistakes, and attribute that to loss aversion. I view it as an example of Monty’s own lack of player development. His inability to develop talent and improve players is the direct CAUSE of these guys not being ready to play. Yes, Anthony Davis has improved steadily…but he’s such a talent that it’s a little ridiculous to presume Monty Williams played an essential role in that growth. That’s like saying Mike Brown developed LeBron James into the player he is today. Hardly makes any sense. And, even if one WERE to concede that point…then why have Rivers, Aminu, Miller, et al. not improved at all, let alone steadily? Heck, we let one of those three walk and cut the other due to a lack of improvement. This doesn’t add up, and it seems it has nothing to do with loss aversion.
    – You reference Monty’s slow pacing as an example of loss aversion as well, making the connection that he’s effectively reducing the opportunities to make mistakes and, therefore, decreasing the odds of losing. I’d take it a step further, however: our offensive strategy stinks. We have a team that plays at a pace that ranks in the bottom third of the NBA (we’re getting about 93 possessions per 48 minutes) – however our offensive efficiency is alarmingly good. Our offensive rating is 108.4 per This indicates that for every 100 possessions we have, we’d score 108.4 points. This would be good for 8th best in the NBA. Our actual points scored per game is 101 (15th in the NBA – smack dab in the middle); this indicates that if we played a more uptempo offense – the exact opposite of what Monty does – we would score more points. While there would theoretically drop us from 20th in defense to 24th (due to more offensive possessions for the defense), it is a marginal defense to go from 20th to 24th on defense v. middle of the road to elite on offense. Of course, I’m obviously assuming all other factors would be equal or marginally different for the sake of this point.
    – Finally, the timeout issue. To use your San Antonio example: Monty had the opportunity – really simply – to call a timeout to run a set in-bounds play. There are two outcomes here: it works or it doesn’t. As our coach, he needs to own that moment. We have a young(ish) team that doesn’t know much about winning tight games. It’s entirely illogical for him to leave it in their hands when he has – theoretically – the knowledge that would give them an edge and improve their chances of success. That is, as simply as I can say it, poor coaching. He has done this on numerous other occasions, which I won’t waste time trying to list.
    Again, this is just my opinion, as your piece was. My opinion is also grounded in fact – I just happened to arrive at a different conclusion. I hope this is sufficient detail (I’m not being sarcastic, but you have to admit: this is much more than anyone should have to write in response to a blog post).

  12. mojart

    January 8, 2015 at 6:38 pm

    hey sir calmes if you are the pels GM do you fire him now or stick with him the rest of the season?and just curious who do you want to coach this team and why…:-)

    i remember mcnamara answer me he wants shaka smart to coach this team

  13. Jason Calmes

    January 8, 2015 at 8:12 pm

    Littlewing745 Jason Calmes Thanks for writing more. Being a little more specific made it enjoyable to read. 
    From the start, the claim was never that Monty was good or bad, but that there is some good evidence that he is irrational in a very common way. So I don’t see a contradiction between what I said and him being a coach of whatever quality. 
    This was one observation i made, and that single observation has some explanatory power in a few different areas. This is something that makes a theory attractive. It in no way makes it correct. 
    I have yet to see someone challenge the idea that Loss Aversion is a factor with Monty, so I’m assuming people agree. 

    Now, on to your points, some of which need a little work. You may be right, but what you are presenting is flawed in some ways (I’ve of course asked the readers to do the same with my piece).
    As far as the Anderson things goes, this article clearly indicates to me that Monty was an important piece (among many and not the most important of them) to get him to play this year or ever again. To me, that translates into wins.
    Ryno has developed a better inside game, as well. 

    As far as Team USA goes, I don’t know why the want Davis’ coach and not anyone else’s? For the 2012 games the coaches were K, McMillan, Boeheim, D’Antoni, and Colangelo as a director. Why Williams for Davis and no such relationship for anyone else?

    In terms of development, Monty has clearly developed multiple players. You can point to players like Xavier Henry who have not set the world on fire (despite his run with LA), but he revived the career of Jason Smith and Marco Belinelli. Morrow took a min deal and got a nice pay and team upgrade on his next deal. Aminu signed a free agent deal with Dallas for the minimum, which is a middle case. Lopez certainly is more highly thought of after his time here. There are more good cases than bad, and I would say many more. 

    As far as pace goes . . . if he had more possessions and scored more . . . so too would the other team. Merely increasing the pace only inflates the differential between the teams on average. 

    Your last point about the timeouts is actually agreeing with the article. 

    You are taking different kinds of things you see as deficiencies and calling them all examples of being a poor coach. I’m saying they stem from one trait. To me, my explanation is simpler, but at some point it’s just semantics. 
    I do, however, think your case needs a little work.

    Now, this is not to start something. This is the kind of discussion we should all be having. I’m here to interact and learn. There are plenty of places on the internet where discussion is ruled by baseless claims, and it just gets worse from there. 
    I know it’s more work to lay things out in detail, but I think it’s worth it. I really don’t need agreement here. I do need a respectful back-and-forth.

  14. Jason Calmes

    January 8, 2015 at 8:14 pm

    wilthomas178 Have 2 advil, a lie down, and read it again tomorrow (or right before bed if you need help getting to sleep).

  15. Jason Calmes

    January 8, 2015 at 8:19 pm

    mojart Stick with him through the season. Changing coaches is not as easy as most make it out to be. I think that is because most people do not realize how hard of a job it is to both be a good coach and to find and hire a good coach You have to think about this deeply, man.

  16. Jason Calmes

    January 8, 2015 at 8:22 pm

    adfly Yes. There are other examples that I was hoping would come out in the discussion, like the lack of turnovers (one of the lowest TOV% in the NBA), or McNamara’s point about the wide open threes.

  17. mateor

    January 8, 2015 at 8:31 pm

    Jason Calmes mojart I was a big Monty supporter in the past but not so much the last two years. I agree with many points in this post as a matter of fact. But I don’t see any profit in firing Monty this year. I don’t think he will be back next year though, even if the Pels get the eighth seed.

  18. billfromfinance

    January 8, 2015 at 8:47 pm

    So expanding on this concept, there is a potential also from Monty to over value (not sure if this is the correct term I am wanting at this point) his players, which would make the conversations with Dell of interest when discussing team dynamics and possible trades (loss aversion and reluctance to trade). Loss aversion predicts that people would be reluctant to give up a gift already in their possession, to obtain another – only 10% choose to do so (social psychology, handbook of basic principles). In essence, “I don’t want to give up Ryan Anderson for Luol Deng, because I already have Ryan Anderson” and the potential perceived loss. I’m not pretending to be all knowledgeable on the topic here (so feel free to correct me if I am interpreting incorrectly), just very interesting and started reading a few things after your article – and expanding the basic concept if Monty is truly loss averse.

  19. Jason Calmes

    January 8, 2015 at 9:51 pm

    Loss Averse or no, we all benefit from trying to understand what goes on in the NBA and the heads of those in it.
    What you are describing is the Endowment effect (value your stuff more than stuff you don’t have, etc.), that I refer to in the piece. Economists have concluded that the Endownment Effect follows from Loss Aversion.
    And I think you are DEAD ON about carefully parsing what these guys say. I know I do that, trying to pay most attention to the stuff that is a real choice.

  20. Pelican Poster

    January 8, 2015 at 11:10 pm

    Jason Calmes Littlewing745 I think some of the better examples of improving players was Lopez, Vasquez, and also Roberts.  Not saying they are all stars, but they definitely got on the map while playing with us…Morrow certainly a great example.

  21. Pelican Poster

    January 8, 2015 at 11:12 pm

    MCMaxJD A few weeks ago I noticed he started arguing more with the refs and did get a tech in one of our road games…

  22. Pelican Poster

    January 8, 2015 at 11:14 pm

    Jason Calmes I always wondered why we rarely go for 2 for 1’s and I see other teams do it as a staple of their strategy…I agree that L.A. is a good reason why

  23. Rico2

    January 9, 2015 at 8:58 am

    Jason Calmes Littlewing745 I believe we can all agree that losing equates to bad coaching, correct? and that in most forms of applied science, data and analysis is used to form a defining result that’s either negative or positive.
    You titled your blog as “Loss Aversion may be causing losses”–meaning that the use of Loss Aversion by Monty Williams is in fact the reason the Pelicans may be losing. Although you present the context of your blog in a non defining analytical approach, the use of such a title steers readers to believe that this approach that Monty Williams is using is DEFIFINTLY the culprit behind our many head scratching losses and inconsistent play. I’m sure this title was chosen as a way to increase the likeliness that the general public would click the article, but the title is not at all appropriate. I believe that Little wing was doing you a favor by actually taking your analysis and giving it a true result. A result that you clearly were not ready to make even though you made claims to the findings in the title and a result that can be simply identified by wins and losses.

  24. Rico2

    January 9, 2015 at 9:12 am

    Jason Calmes Littlewing745 In contrast, I’m sure if the Pelicans had a winning record now your title would have read, “Loss Aversion may be reason for wins” or something of that nature. Which of course suggest that he is a good coach because his methods are producing a winning record.

  25. Jason Calmes

    January 9, 2015 at 9:17 am

    1) Losses may be caused by bad coaching, but losses do not imply bad coaching. Losses can be caused by a poorly fitting roster, injury, and many more things.
    2) You really think “May” equates to “DEFINITELY” in this article? I state a claim and evidence. I ask for discussion, and clearly indicate that this is an attempt to understand various aspects of his decision-making.
    3) I do not care about clicks and am unpaid by this work.
    Feel free to respond, of course.

  26. Jason Calmes

    January 9, 2015 at 9:19 am

    It would have such a title, because, as the article clearly states, “It’s trying to make sense of the play on the court.”
    You can continue to try to claim the article serves a purpose other than what is clearly stated, but it seems not to be productive.

  27. Rico2

    January 9, 2015 at 10:06 am

    Jason Calmes Although I enjoyed reading this well written and well researched article, I do have to agree with you that it does not seem to be productive.
    Just imagine if every theory or question proposed was not actively seeking a definite result or summation– the world would never advance. Surely you see the unproductiveness in that.

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