Subtraction,com: Watching Yankees Spending

I’ve always thought, too, that vilifying the Yankees payroll was a perspective that lacked dimension. Yes, it’s a consistently stratospheric number, but isn’t it significant, too, that by making their home in New York the Yankees are at the epicenter of the biggest baseball market on the planet? The team franchise has a payroll that’s commensurate with its huge valuation, if nothing else.

However, as a counter-argument, declaring the team a victim of its own incredibly lucrative circumstances seems equally one-dimensional. So I wondered recently if it might also be true that the Yankees are not just big spenders, but big investors, as well. Anecdotally at least, I knew that their single-minded dedication to winning championships year after year no matter the cost stands in contrast to the perpetual inefficiencies I’ve heard about at other clubs, where owners routinely pocket revenues from the so-called “luxury tax” that they receive from free-spending teams like the Yankees, rather than re-investing the money in talent.

So I dug around a bit online and compiled some figures, dumped them into Excel and found that, relative to the value of their franchise, the Yankees actually invest a fairly high percentage of their revenues directly in their payroll.

Ignore the improper description of the MLB luxury tax, and this is an interesting overview — using the rough numbers available — at how MLB teams re-invest in the on-field product at the Major League level.