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Tuesday, August 25, 2015

Relationship Between Spending, Winning Remains Low

This never would have happened if baseball had a salary cap.

About a year ago, the Providence Journal ran a piece, Money Can’t Buy Success for Teams Anymore, discussing the relationship between wins and payroll. The article took a look at Opening Day payrolls over the last decade and correlated the payroll with wins. Brian MacPherson found that from 2002 to 2008 the correlation coefficient for wins and payroll exceeded .4 and was generally around .5, but that the relationship had declined and, at the time of the article last year, the correlation coefficient was just .2, dropping to the point that alphabetical order had a stronger relationship to wins than payroll. I ran the numbers with the win totals from the end of the season, and while it was not quite as low as it was in mid-August, r was just .25 at the end of last season.

Anecdotally, with the success of Houston and Pittsburgh (Kansas City actually has a mid-level payroll this season), it appears that the recent trend has continued this season…..

Again this season, there is not a great relationship between wins and Opening Day payroll. So far this season (through August 23), r is .17, even lower than it was a year ago at this time. Of course, Opening Day payroll is not the only measure of a team’s financial wealth. Fortunately, using the current payroll data from spotrac, we can compare wins to a team’s current payroll, after teams have added and removed players. The correlation of current payroll and wins is a little higher, at .25, but this is to be expected as the teams with more wins are likely to be adding payroll while teams with fewer wins are likely to be jettisoning larger contracts.

RoyalsRetro (AG#1F) Posted: August 25, 2015 at 03:14 PM | 2 comment(s)
  Beats: money, payroll

 

 

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