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Friday, March 31, 2017

Why the MLB is flooded with huge contracts - CNN.com

But forecasting baseball players’ productivity based on past performance is tricky, says Berri, who co-authored “Stumbling on Wins: Two Economists Expose the Pitfalls on the Road to Victory in Professional Sports.”

“Salary is a function of what (a player) did in the past,” says Berri, who notes that MLB general managers often overlook the obvious when considering the future—including the downfall of an aging superstar like 37-year-old Albert Pujols.

The three-time MVP’s batting efficiency has declined since signing with the Los Angeles Angels in 2012, yet has five years and $140 million remaining on his contract.

“I’ve spoken to a lot of different people in sports; I never get the impression that they know what they’re talking about,” says Berri.

“There is a sense you get that they would know who’s good and whose bad, and they would figure this stuff out.”

Jim Furtado Posted: March 31, 2017 at 11:05 AM | 33 comment(s)
  Beats: economics

Tuesday, March 07, 2017

Max Scherzer and Jon Lester Have Been Free-Agent Bargains | FanGraphs Baseball

Bargains? Mookie Betts is a bargain. Kris Bryant is a bargain. Noah Syndergaard is a bargain. Scherzer and Lester aren’t bargains.

Jim Furtado Posted: March 07, 2017 at 02:44 PM | 9 comment(s)
  Beats: economics

Wednesday, February 22, 2017

Restricted Free Agency, Anyone? | FanGraphs Baseball

Salary arbitration in conjunction with free agency has treated the players quite well over the years. With exploding revenues and smarter front offices, however, the players’ share of the pie has been getting smaller. No matter what changes get made to 4-6 year players, without a higher luxury cap, the players’ share will continue to get smaller. Nevertheless, it might be a good time to think about moving from the current arb system to a restricted free agency model for 4-6 year players. How? I like the solution proposed by Adam Dorhauer on HardballTimes.com last year. It’s relatively simple but gets rid of the funky current system with a market driven approach which seems to balance the needs of owners and players.

Jim Furtado Posted: February 22, 2017 at 11:17 AM | 15 comment(s)
  Beats: cba, economics, salary arbitration

Friday, February 10, 2017

The Disconnect Between Franchise Values and Player Salaries

Specifically, MLBAM and their BAMTech spin-off unit have created an enormous technological powerhouse by moving early into streaming technology, and BAMTech is now one of the world’s dominant players for hosting and providing over-the-top content…..

While nothing in life is guaranteed, that money is pretty likely to be distributed at some point in the not-too-distant future, so anyone buying the Marlins (or any other MLB team) is likely to get a pretty significant rebate on the purchase price if or when Disney buys out the league’s interest in BAMTech. And the sale of BAMTech does nothing to affect the league’s ownership of MLBAM, which remains a significantly valuable operation itself, and is still entirely owned by the 30 teams.

In other words, if you buy the Marlins, you’re buying a baseball team, but you’re also buying a 3% stake in a very valuable tech company, and you’re buying about a 2% stake in an even more valuable tech company that already has a purchase agreement in place. And it’s not really clear that the players have much in the way of a legitimate claim to any of the money that baseball owners are generating from the investments in these tech companies.

RoyalsRetro (AG#1F) Posted: February 10, 2017 at 02:36 PM | 0 comment(s)
  Beats: economics, franchise valuation, marlins, mlbam

Saturday, December 17, 2016

Dodgers, Yankees among record six MLB teams to pay luxury tax

A record six teams are paying baseball’s luxury tax this season, led by the Los Angeles Dodgers at $31.8 million and the New York Yankees at $27.4 million.

Boston ($4.5 million), Detroit ($4 million), San Francisco ($3.4 million) and the World Series champion Chicago Cubs ($2.96 million) also were sent bills Friday by the commissioner’s office, according to information obtained by The Associated Press.

Jim Furtado Posted: December 17, 2016 at 05:30 AM | 21 comment(s)
  Beats: cba, economics

Monday, November 28, 2016

Donald Trump’s tax plan could affect MLB free agency | SI.com

Some interesting info.

Jock Tax

In assessing state income tax variations in how teams pursue free agents, players’ representatives should consider the impact of “jock taxes.” As we have explained in other SI.com articles, a “jock tax” is a tax imposed by a state and municipality on the proportion of income attributed to athletes on visiting teams when they play games in that state or municipality. Put in its most basic form, a jock tax is an income tax levied on a visiting team’s player because he or she is playing a game there.

The jock tax is controversial because no similar mechanism is strictly enforced to tax other types of professionals in similar ventures, such as a physician or attorney who travels to another state or municipality for a business purpose. Jock taxes are also subject to change based on a host of factors, including political ones.

Bottom line: state tax lax variations matter and it probably makes sense to defer income to 2018-20.

Jim Furtado Posted: November 28, 2016 at 08:48 AM | 5 comment(s)
  Beats: cba, economics

Sunday, November 27, 2016

After $1 billion in player spending, Dodgers under MLB mandate to cut debt - LA Times

The Dodgers, who have spent more than a billion dollars on player payroll in the first four seasons of Guggenheim Baseball Management, face a mandate to reduce debt in order to conform to Major League Baseball rules.

The club is expected to reduce payroll for a second consecutive season, with the goal of cutting from about $300 million in 2015 to closer to $200 million in 2018.

Jim Furtado Posted: November 27, 2016 at 09:57 AM | 11 comment(s)
  Beats: dodgers, economics

 

 

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