What are NFL draft picks really worth (and do they help teams win)?

One of the biggest moments in the history of the NFL Draft took place almost as far from it as possible. On October 12, 1989 – 171 days after Everett Ross became Mr. Irrelevant as the last pick of the 1989 Draft and 192 days before Jeff George kicked off the 1990 edition – the Dallas Cowboys sent Herschel Walker and a handful of picks (two 3^rd rounders, a 5^th and a 10^th) to the Minnesota Vikings in exchange for five players, three 1^st round picks, three 2^nd round picks, a 3^rd round pick and a 6^th round pick. Dallas’ multiple 1990s Super Bowl runs were powered by players such as Emmitt Smith, Russell Maryland, Alvin Harper and Darren Woodson who either came directly from the picks or as a result of further trades involving those picks.

Mike McCoy, who owned approximately 5% of the team, had been a business partner of majority owner Jerry Jones in the oil business. The team was looking for a way to systematically value their cache of draft picks, and McCoy was the one to do it. According to a 2004 Dallas Morning News article, McCoy spent two days graphing the actual trades that had taken place over the past four years. He found that the trades appeared to fit a trendline overlaid on the graph. This trendline became the basis for the Draft Value Chart[1].

The Chart provides a value for each pick in the form of unitless “points” assigned decreasing from 3000 for the number one overall to, depending on which source you consult, 0.4 points for the 256^th pick or 2 points for the 224^th pick[2]. The decrease in point values is extremely steep at the top of the draft with the value dropping by 50% to the 7^th pick and by another 50% to the 24^th pick, leaving it only 25% as valuable as the number one selection for trade purposes.

Since the early 1990s the Draft Value Chart has made its way through the NFL and become the basis for draft pick value on nearly every team. The assistant coaches and assorted front office employees from the Cowboys took it around the league when they left the team. Research conducted by Cade Massey and Richard Thaler plotting actual trades found that prices aligned closely to The Chart with the deviation from the chart dropping significantly and trade volume increasing in the years after it became well known[3]. In other words, once the chart became widely accepted teams did not vary from the assigned values.