Reports have surfaced in the past few days that Golden State Warriors shooting guard Klay Thompson is seeking a max-level contract amounting to five years and $85 million. This is an astronomical sum for a player who may or may not even be an All-Star during his career. So, what is Thompson’s true monetary value to the Warriors? The chart below helps illustrate this.
As I detailed in my previous article about Thompson, he is probably about as good now as he ever will be; most shooting guards peak in about their third or fourth seasons and slowly decline after that. His projected wins above replacement — calculated using Estimated Wins Added based on samples of 100 combo guards and shooting guards from 2005 to the present — provide an approximate value for Thompson for the next few seasons. Wagesofwins.com provides data on costs per win for teams with different spending patterns and different talent levels. The Warriors most closely resemble a team spending at the tax with about 52 wins, which informs their costs per win. Keep in mind that due to the dynamic nature of the salary cap, which rises each season, players get paid more each year, leading to higher costs per win.
Looking at Thompson’s projected contributions and the costs per win in each of the next five seasons, Thompson is deemed to be worth about $8 million a season. This is a far cry from the on-average $17 million a year he is seeking, but will provide the Warriors with a positive return on his contract in four of five seasons.
Several factors are not accounted for here; of course, Thompson may not develop the way he is projected to, and may continue to get better for several years instead of peaking next season. Moreover, the supply of quality shooting guards is rather scarce, but demand is high, meaning that shooting guards may be more valuable than the figures above suggest. Thompson also serves a rather unique role for the Dubs in covering Stephen Curry’s man most of the time so Curry can save his energy for offense – in effect, Thompson makes Curry better, which is not reflected in his Estimated Wins Added.
While all of these factors make Thompson a more valuable asset than $8 million a year, they do not add up to validate a max-level contract.