Continuous Productivity

Moneyball Missed the Reserve Clause?

Great article arguing that although baseball is an inefficient market, it is not a completely free market:

The problem with likening the market for baseball players to an equity market is that the former is not a genuinely free market. The reserve clause binds players to the team that drafted them for the first six years of their career; during this time they cannot become free agents and sell their services to the highest bidder. So the intrinsic value of a highly productive player will rise, but he will not necessarily be paid his market value until he has completed his “indentured servitude” (as Lewis termed it). Thus it is not surprising that while payroll cannot tell us anything about wins, it does a pretty good job of predicting a team’s average age: young players are much cheaper.

To understand how much the reserve clause matters, let’s look at the young talent on the Oakland squad Lewis chronicled. Shortstop Miguel Tejada hit 30 home runs for the low, low price of $290,000 in 2000. Two years later, when he won the American League MVP, he made only $3.5 million (I know, but it’s all relative). His free agent contract, which he signed with the Baltimore Orioles after the 2003 season, was for $72 million over six years. Eric Chavez (whom the A’s actually did sign to a long-term market-value contract in 2004) produced 32 home runs in 2001 for $625,000.

Mark Mulder, Tim Hudson, and Barry Zito, the A’s “big three” pitchers, led the team to the 3rd, 2nd, 1st, and 1st American League ERA ranking, respectively, from 2000 to 2003. In 2001, when the A’s won 101 games, the combined salary of Tejada, Chavez, MVP-runner up and all-star first baseman Jason Giambi, Mulder (21 wins), Hudson (18 wins), and Zito (17 wins) was under $8 million. In the first year after each player’s “indentured servitude” ended, the six made a total of $43 million. The A’s won even though they were poor because they did not have to pay their young players what they were worth.

Giambi, who won the MVP in 2000, epitomizes the economics of baseball. He joined the Yankees as a free agent after the 2001 season. In that first year with his new team, he made more in salary than in the seven years he spent in the A’s organization combined. This turned out to be some deal for Oakland. As the San Francisco Chronicle’s Vlae Kershner recently pointed out, Giambi produced about half of his career home runs and RBIs in an A’s uniform. For that output, the team paid about 9 percent of his career earnings (up to the end of last season).

Just as the A’s could not have afforded to compete without the reserve clause during their “moneyball” run, no small-market team could compete without it today.

She is a Strikeout Queen

A female baseball player that throws a nasty knuckleball:

It Could Happen

They have never heard of Babe Ruth, Hank Aaron or Jackie Robinson.

They can tell you about Sachin Tendulkar, one of India's greatest cricket players, but would tell you Michael Jordan is a clothes designer, not a former basketball player.

Rinku Singh and Dinesh Patel, two 19-year-olds from small villages in India, desperately want to live the American dream. Their shot at it is a decidedly improbable one.

They had never picked up a baseball until a year ago. Thursday, they will pitch in front of major league scouts in Tempe, Ariz., in hopes of landing a professional baseball contract.

Interesting experiment called the "Million Dollar Arm" to find pitching talent in India.

Nate Silver Profile

A very good profile on Baseball Prospectus' Nate Silver at the University of Chicago Magazine. It delves into the usual's such as his background, how he got started, etc. But more interestingly, it explains the importance of statistics to baseball. In short, no statistics, no baseball:

From baseball’s earliest days, fans have sought to understand the sport by examining its statistics. More than a decade before the first professional team, the Cincinnati Red Stockings, emerged in 1869, newspapers printed box scores—tables listing players’ names, how many runs each player scored, and the number of hands lost, or outs, each player caused. “It was not particularly sophisticated,” says Alan Schwarz, a New York Times sports writer and author of The Numbers Game: Baseball’s Lifelong Fascination with Statistics (Thomas Dunne Books, 2004), “but it was the first attempt to say what happened in the game.” By the turn of the 20th century the sport evolved into some semblance of modern-day Major League Baseball—team owners formed the National League; pitchers began throwing overhand standing 60 feet, 6 inches from the plate; batters walked after four balls and struck out after three strikes; and fielders wore gloves. Statistics also evolved, and newspapers started tracking pitchers’ innings pitched, hits, earned runs, walks, and strikeouts; and hitters’ batting averages, hits, and runs scored. In 1920, when Major League Baseball began requiring umpires to replace balls at the first sign of wear, fans and reporters reveled in the flurry of history-making records that stemmed from higher-scoring games.

The fascination with stats kept growing. In 1952 the Bowman Gum company and Topps Chewing Gum printed their first baseball cards, featuring players’ data on the flip side—info kids promptly memorized. As Schwarz wrote in The Numbers Game, “Topps baseball cards joined box scores as the major pipelines that fed statistics into young boys’ brains.” In 1961, when Bucknell University mathematics student Hal Richman compiled statistics into Strat-O-Matic, a tabletop game where players make strategic and personnel decisions, he spurred a generation of children and adults to think critically and scientifically about baseball.

Roger Clemens and Teenagers

The more we learn about Roger Clemens, the more we realize how much of a lowlife he is:

Roger Clemens carried on a decade-long affair with country star Mindy McCready, a romance that began when McCready was a 15-year-old aspiring singer performing in a karaoke bar and Clemens was a 28-year-old Red Sox ace and married father of two, several sources have told the Daily News.

Roger Clemens has some serious delusional issues about his infallibility. He is clearly grasping at straws instead of letting this situation just go away. He has made a fool of himself, has opened himself up to perjury charges, and now:

"The issue in Roger's suit against McNamee is Roger's reputation and how it has been damaged," said Richard Emery, one of McNamee's lawyers who is handling the defamation suit. "If it's proved that he's a philanderer, his reputation is already damaged. When you sue for defamation, you put your whole reputation in the community at issue. Anything is fair game, including his claim of sanctimonious purity. We would cross-examine him and other witnesses who might impact on his alleged behavior. We would probably subpoena her and witnesses who knew [of the relationship]. He's a 'family man' - he implies that. It's about what his damages are. All is fair game."

Baseball and August

If you want your kid to be a baseball player, make sure he is (was) born in August:

For more than 55 years, July 31 has been the age-cutoff date used by virtually all nonschool-affiliated baseball leagues in the United States. Youth baseball organizations including Little League, Cal Ripken/Babe Ruth, PONY, Dixie Youth, Hap Dumont, Dizzy Dean, American Legion, and more have long used that date to determine which players are eligible for which levels of play. (There is no such commonly used cutoff date in Latin America.) The result: In almost every American youth league, the oldest players are the ones born in August, and the youngest are those with July birthdays. For example, someone born on July 31, 1990, would almost certainly have been the youngest player on his youth team in 2001, his first year playing in the 11-and-12-year-olds league, and of average age in 2002, his second year in the same league. Someone born on Aug. 1, 1989, by contrast, would have been of average age in 2001, his first year playing in the 11-and-12-year-olds division, and would almost certainly be the oldest player in the league in 2002.

Twelve full months of development makes a huge difference for an 11- or 12-year-old. The player who is 12 months older will, on average, be bigger, stronger, and more coordinated than his younger counterpart, not to mention more experienced. And those bigger, better players are the ones given opportunities for further advancement. Other players, who are just as skilled for their age, are less likely to be given those same opportunities simply because of when they were born. Alex Rodriguez would've been a star no matter his birth month, but a player like Juan Pierre, who has less natural aptitude for the sport, might have gotten a small leg up over similarly skilled players because he's an August baby. It's clear from the chart above that this small advantage can have an impact that lasts a lifetime.

Read the entire article.  It highlights a much broader concept of how a decision that seems static can have a very dynamic result in the long-run.  It's fascinating how something arbitrary like a cut-off date can have such a huge impact on an entire industry. 

Baseball Player IPO

Via the always awesome Marginal Revolution:

Randy Newsom, relief pitcher for the Cleveland Indians, is selling 4% of his future major league salary.  There are 2,500 shares in the IPO so each share gets you a claim to 0.0016% of his future salary including bonuses.  Shares sell for $20 each.

Makes perfect sense.  I'd imagine that if MLB actually allows this, the market would be huge.  Look at the sheer size of fantasy sports and think of this as fantasy sports on steroids (or rather HGH).

Baseball and Alcohol

It seems that baseball and alcohol have been in the news a lot the last 18 months.  The news has gotten tragically worse.

I won't even pretend to understand the psyche of a professional baseball player, but it doesn't surprise me that Leyritz was an utterly cocky SOB:

Rookie ballplayers are known to keep a low profile around the clubhouse, especially when entering the hallowed halls of Yankee Stadium. Leyritz was not a typical rookie.

After posting impressive numbers in the minors, the then-27-year-old infielder swept into the clubhouse with a swagger that raised the eyebrows of several veteran players, including a true legend, Don Mattingly.

Leyritz wore a cowboy hat, boasted about his talent often and, at the plate, would twirl his bat after every pitch.

"Most of the time a young player will come in and he wants to be heard but not noticed," said Wayne Tolleson, 51, the then-Yankee shortstop who was in the twilight of his career when Leyritz joined the team. "Jim was one of those guys that looked like he wanted to be noticed."

Again, playing quasi-psychologist, it's easy to deduct how that personality type can feel confident getting behind the wheel of a vehicle while intoxicated.  We've all dropped a pair of artificial cojones with the aid of the juice.  Couple that with the extreme confidence it takes to play professional baseball, and it wouldn't surprise me if drunk driving is (more) rampant in professional sports.  Or perhaps I am sensationalizing. 

'Roid Rage 'Roids and Age

Marginal Revolution (a daily must-read) pointed me to this great analysis by economist Steve Walters.  Walters outlines a study by Yale economist, Ray C. Fair. 

I wanted to finish watching the 60 Minutes piece on Roger Clemens before I completed this post. 

Anyway, I completely agree with the consensus that Clemens comes off as an asshole.  Perhaps, I am biased, but the credibility levels of his answers were very low.  As expected, Mike Wallace did not push.

Back to the earlier article, which seems to put some empirical data around what most ardent baseball fans already know.  Fair asked, and sought the answers to, a few very important questions as they relate to steroids and baseball:

When do ballplayers reach their peak? He used some sophisticated statistical tools to get the basic answers (28 for hitters, 27 for pitchers) for his sample of 441 hitters and 144 pitchers who played at least 10 full seasons between 1921 and 2004.

Then he asked this follow-up: Which players have exhibited the most unusual age-performance profiles? Specifically, are there any players who got better with age?

He then precedes to show that only 18 players since 1921 have exceeded their age-expected output levels by greater than one standard deviation.  And just as you would suspect, of the 18, 15 played in the 1990's. 

Still believe that steroids don't have an impact on player performance?