Probably hard to believe because according to that they are eighth highest.

Baseball players are paid more for playing baseball well.
The best players should be paid the most money.
The best teams should have the best players.
The best teams should be paying the most money.

If seven of the top nine payrolls weren't at least contenders, there would be something seriously wrong.

Cardinals are at $124M? Somehow I doubt that. I think they are adding in the full salaries for Lugo, Holliday, DeRosa and Smoltz without factoring playing time.

Doing the math, comes to $122M, using Cots opening day salary of $88.5M as a starting point and $13.5m for Holliday, $9M for Lugo, and $5.5M for DeRosa and Smoltz.

The real number is about $95.3M, with Holliday costing $3.885M, DeRosa about $2.75M, Lugo 100k, and smoltz 100k. This puts them tied with the giants at #14, though there's probably some more fuzzy math going on with other teams as well.

Oh, in the fine print it does say "Does not account for salary being paid by other teams." So Bob was either intentionally dishonest or lazy, not incompetent.

Source: USA TODAY research

What a garbage publication.

Actually, I think the information is correct, but they're failing to provide the context. Yes, they are doing things like adding full salaries for guys like Lugo who has only been with the Cardinals for part of the season, but this is how MLB calculates for the Luxury Tax threshold. If I remember correctly, there's also a set amount added for each team that accounts for the Minors. I seem to remember this number is something like $20M per team, but that could be wrong.

And this is the first time in years that payroll has correlated with winning to such an extent.

#5 - iirc, the set amount isn't for the minors - it's for the various payroll collections the teams are responsible, like the MLBPA Pension plan. I don't think it's $20 million though. Still significant, especially for small budget teams.

#6 - yes, the first time it's correlated in years to such an extent - but there should be correlation. Not just because of what #2 says - but since the figures come post deadline trades and include full season totals for salary - of course teams out of contention tend to trade high salary players, while teams in contention tend to be the ones trading for them (excepting the White Sox, who added players even though they don't count as in contention). The A's wouldn't have traded Holliday, and the Cardinals wouldn't have acquired him, if the A's weren't out of contention and the Cardinals weren't hoping for post-season success. And any publication that uses these figures without explaining that isn't really out to reveal the truth.

And any publication that uses these figures without explaining that isn't really out to reveal the truth.

They probably just didn't put much thought into this (whether full- or partial-year salaries are used for acquired players, etc.). Bob likely just wrote the piece and had an intern copy and paste the totals directly from somewhere. If they actually cited their information, like, you know, journalists are supposed to do, we'd know where.

If seven of the top nine payrolls weren't at least contenders, there would be something seriously wrong.

I'm not so sure. Players peak in their mid-to-late 20's. They come up to the majors typically at age 23 or so, if they have real potential. Most star players should be arbitration eligible, but not free agency eligible in their primes. This is how teams like the early 1990's Expos and more recent Twins, Marlins and A's have managed to stay competitive without spending much money. Teams with big payrolls have mostly guys past their primes. They're star players who are past their primes, but they're past their primes nonetheless, and much more subject to situations like what the Mets have with a rash of injuries.

Maybe I buy that 7 out of the top 9 payroll teams should at least be contenders, but I think it's actually quite surprising if there's a really strong correlation between payroll and success.

If seven of the top nine payrolls weren't at least contenders, there would be something seriously wrong.

How is it 7 of 9 (Heh)? Surely the Mets and the 2 Chicago teams are in the top 9. Hell, I thought they were in the top 5.

They used MLB-provided figures; MLB always uses full-season salaries of current players on current teams in the figures they give out for current payroll. The conspiracy theorist in me notes that they started doing this when they were first tooting the "competitive balance needs salary cap!" in the early-90s.

As an example, the reasons the Dodgers have a $148 million payroll is that they're "credited" for the $34 million in full-season salaries of Padilla, Thome, and Garland, despite the fact that they're paying the pro-rated minimum for Padilla, nothing for Garland, and just a few million for Thome.

Comparing it to Cots there is a lot of differences. I mean the Cardinals aren't paying one penny of Lugos salary this season. (and only a little of next) The Pirates have a 29mil payroll on here, but on some of their trades they actually included money.

#6: The payroll-wins correlation in any given year is not that high, for two reasons: 1) there is a lot of luck in teams' W-L record, and 2) baseball teams cluster in a pretty narrow range of win% (compared to, say, football or basketball). But if you combine a few years worth of data, the relationship is clear and very strong. Those who point to the As or Marlins and claim that "payroll doesn't matter" (or doesn't matter very much) are really missing the story. A big payroll, while no guarantee of success, provides a huge advantage; a small payroll is a huge handicap.

Here are the decade win totals as put together by Rich Lederer (last column is total wins). If someone wants to calculate the decade payroll totals for the teams, I guarantee you will see a very high correlation.

Num TEAM 2009 2008 2007 2006 2005 2004 2003 2002 2001 2000 TOTAL
1 NYY 82 89 94 97 95 101 101 103 95 87 944
2 BOS 76 95 96 86 95 98 95 93 82 85 901
3 STL 77 86 78 83 100 105 85 97 93 95 899
4 LAA 77 100 94 89 95 92 78 99 75 82 881
5 ATL 68 72 84 79 90 96 101 101 88 95 874
6 OAK 57 75 76 93 88 91 96 103 102 91 872
7 LAD 78 84 82 88 71 93 85 92 86 86 845
8 CWS 64 89 72 90 99 83 86 81 83 95 842
9 MIN 65 88 79 96 83 91 90 94 85 69 840
10 SF 72 72 71 76 75 91 100 95 90 97 839
11 PHI 75 92 89 85 88 86 86 80 86 65 832
12 SEA 68 61 88 78 69 63 93 93 116 91 820
13 HOU 62 86 73 82 89 92 87 84 93 72 820
14 CLE 58 81 97 78 93 80 68 74 91 90 810
15 NYM 59 89 88 97 83 71 66 75 82 94 804
16 ARI 59 82 90 76 77 51 84 98 92 85 794
17 FLA 68 84 71 78 83 83 91 79 76 79 792
18 CHC 65 97 85 66 79 89 88 67 88 65 789
19 TOR 58 86 83 87 80 67 86 78 80 83 788
20 TEX 72 79 75 80 79 89 71 72 73 71 761
21 COL 72 74 90 76 67 68 74 73 73 82 749
22 SD 56 63 89 88 82 87 63 66 79 76 749
23 CIN 56 74 72 80 73 76 69 78 66 85 729
24 MIL 64 90 83 75 81 67 68 56 68 73 725
25 DET 69 74 88 95 71 72 43 55 66 79 712
26 WAS 46 59 73 71 81 67 83 83 68 67 698
27 BAL 54 68 69 70 74 78 71 67 63 74 688
28 TB 70 97 66 61 67 70 63 55 62 69 680
29 PIT 53 67 68 67 67 72 75 72 62 69 672
30 KC 50 75 69 62 56 58 83 62 65 77 657

It's disgusting how teams just buy pennants these days! I hate all those those high-salary teams like...um...the Tigers...?!

Ahem. As you were.

Adding up 300 payroll numbers sounds hard. and there would be an internal problem anyway - if a team wins in one season, they'll have more money to spend in the next season. The relationship is too complex for a simple correlation model. But we can do a correlation with market size, which in a lot of ways is the better metric for looking at competitive imbalance.

TEAM MSize Wins
NYY 262 944
BOS 155 901
STL 56 899
LAA 147 881
ATL 102 874
OAK 61 872
LAD 175 845
CWS 90 842
MIN 69 840
SF 84 839
PHI 130 832
SEA 112 820
HOU 86 820
CLE 84 810
NYM 244 804
ARI 64 794
FLA 95 792
CHC 105 789
TOR 96 788
TEX 103 761
COL 59 749
SD 45 749
CIN 69 729
MIL 39 725
DET 95 712
WAS 78 698
BAL 124 688
TB 87 680
PIT 54 672
KC 38 657

The numbers aren't perfect (I used Mike Jones' nearly decade-old numbers), and they predate the Nats, so BAL's market size is way too big, and WAS' is a little too low. Nonethless, I think it's pretty good. The correlation is .48.

They used MLB-provided figures; MLB always uses full-season salaries of current players on current teams in the figures they give out for current payroll.

Which makes this list garbage, to a large extent. A meaningful list would rank the teams by actual dollars paid this year by each team, which would significantly change the calculus.

As a side note, I saw something that said that the Pirates have about 8 million dollars tied up in next years' payroll. This doesn't include arb-eligible guys or rookie salary, but they only have 8 million in payroll committed for 2010 right now. That's impressive.

As a side note, I saw something that said that the Pirates have about 8 million dollars tied up in next years' payroll. This doesn't include arb-eligible guys or rookie salary, but they only have 8 million in payroll committed for 2010 right now. That's impressive.

if you go to the cots link I listed on posted in the top(which didn't create a link it looks like)
cots link
it has the Pirates commited to 22.975 for next season.

Here are the decade win totals as put together by Rich Lederer (last column is total wins). If someone wants to calculate the decade payroll totals for the teams, I guarantee you will see a very high correlation.

That's the wrong way to look at it. If you have good players and win, eventually your payroll will grow, even if they are all homegrown. As you win, your revenue will grow as well.

Why not look at it by market size. So, your same list, ranked by wins, pop. and TV market. There's certainly correlation, but far from a dominating effect.

Edit: to divide split markets between 2 teams.

1 NYY #1 #1
2 Bos #10 #5
3 StL #17 #20
4 LAA #2 #3
5 Atl #7 #6
6 Oak #24 #21
7 LAD #2 #3
8 CWS #9 #13
9 Min #15 #14
10 SF #24 #21
11 Phi #4 #2
12 Sea #14 #12
13 Hou #5 #8
14 Cle #26 #16
15 NYM #1 #1
16 Ari #12 #10
17 FLA #6 #15
18 CHC #9 #13
19 Tor #5-6 N/A (non-US, equivalent rank)
20 Tex #3 #4
21 Col #20 #17
22 SD #16 #28
23 Cin #23 #34
24 Mil #39 #35
25 Det #11 #9
26 WAS #8 #7
27 Bal #19 #26
28 TB #18 #11
29 PIT #21 #23
30 KC #29 #31
-

That's a correlation of .6 btwn TV market and wins. I'd say that's very high. And using rank is very crude. If you use actual wins and actual population/market, I think you'd get even stronger correlation.

I expect you'll get a notably weaker correlation for the reasons you elaborated in #14 - the spread in wins isn't that large between the best team and the worst.

I got about .48 using a better measure of market size than single tv market rank. I figure that's about what you'd get.

To be clear, I think this evidence is more than strong enough to justify MLB intervention on behalf of competitive balance - I would be in favor of significant expansions in revenue sharing, actually.

EDIT: I'm not opposed to various technocratic proposals to share revenue using complex calculations based on market size, rather than on total revenue. That would make sense. But it's never going to actually be implemented, so I think the more relevant question is what sorts of competitive balance rules would we like to see, among the set of competitive balance rules that one might imagine could possibly be enacted?

That's a correlation of .6 btwn TV market and wins. I'd say that's very high. And using rank is very crude. If you use actual wins and actual population/market, I think you'd get even stronger correlation.

I get 0.49 between total wins and TV households (dividing the 2 team markets in half and with an estimate for Toronto).

To be clear, I think this evidence is more than strong enough to justify MLB intervention on behalf of competitive balance - I would be in favor of significant expansions in revenue sharing, actually.

Is the issue revenue sharing, or getting the owners to spend their revenue sharing?

As a Yankee fan, I have no problem with attempts to improve competitive balance, but I fear that the more revenue you share, the less incentive teams have to try to win.

I'd first like to see a rule that a team's payroll (total including minor leaguers) can not be lower than the sum of national revenue + net revenue sharing + 1/2 local revenue, on a 5-year rolling average. If it is, you lose all revenue sharing for the next 3-years.

I can't believe the "we can't compete" story when teams like Pitt, Mia and KC have payrolls less than what they receive in revenue from the league.

Is the issue revenue sharing, or getting the owners to spend their revenue sharing?

I'm pretty sure it's revenue sharing. I'd be open to being convinced, but from my reading of the data and the rules, the gap between the Yankees and the Pirates is far larger than the revenue shared to the Pirates.

EDIT: obviously, both are issues, but if you had to ask me about the social justice issue about which I care about the least, I would say it's the danger that Hal Steinbrenner, John Henry, and Arte Moreno are not profiting quite as much as they ought to be, while David Glass and the Nutting family are profiting more than they ought to be. I fundamentally don't care. Unless you can show that revenue sharing actually damages competitive balance, the possibility of gaming the system isn't a significant concern of mine.

Is the issue revenue sharing, or getting the owners to spend their revenue sharing?

I think it's getting the owners to spend, for years the Phillies were in the bottom 1/3rd of payroll, I don't think there is a good way with the current system to get the owners to spend (and teams like the Rays last year didn't have to spend as much to be competitive(same with Twins and A's for several seasons)

I mean spending doesn't necessarily mean success, it helps of course, but a good developmental league and drafts also can help at a much lower cost. I do think teams like the Pirates should be forced by the league to do some spending if there is a way to make it work. (maybe identify their three or four weakest positions over the past three years and say they have to acquire a multi-year free agent at one of those positions or something silly like that)

I'm pretty sure it's revenue sharing. I'd be open to being convinced, but from my reading of the data and the rules, the gap between the Yankees and the Pirates is far larger than the revenue shared to the Pirates.

I'm sure that's true. My point is, until they actually spend that money, we don't know what the real competitive balance is. The smallest "market" teams get about $60M in "free money". They should all be able to sustain an MLB payroll north of $80M.

Right now, I bet that if you took an extra $50M from the top-5 teams and gave it to the bottom 5, they'd increase their payrolls by $10M and pocket the rest. I don't think anybody, except maybe rabid Yankee haters and owners of bad teams, wants more revenue sharing that doesn't improve the small market teams.

I do think teams like the Pirates should be forced by the league to do some spending if there is a way to make it work.

What do you think of my "salary floor" idea in #23?

What do you think of my "salary floor" idea in #23?

dislike the idea of a salary floor, like the formula though and the rolling average concept, but think that if a team can compete without spending a lot of money then there should be no reason to force them to go out and overpay for a player. If there is any type of salary floor it would probably have to include a combination of international signings, draft bonus's and team standings into it's component. The Pirates have 17 consecutive losing seasons so they should be required to spend more money, but other teams have been successful without spending money.

of course I also have no problem saying that a team cannot receive revenue sharing more than 1/2 or 1/3rd of their salary(or something like that) so I'm full of contradictions on this issue.

There's no need for complex schemes of salary floors and rolling payroll averages.

Simply use the revenue sharing pool to make marginal revenue from wins closer from city-to-city.

Just to pull a random example, if the Pirates get $0 million from the revenue-sharing pool at 70 wins but they get $60 million for 90 wins, then there's a real economic incentive to make signing good, but expensive players.

When you subsidize something, you get more of it. The current revenue plan subsidizes having low revenue rather than subsidizing team investment.

Of course one minor issue is that according the MLB the money revenue sharing money is not exclusively for payroll it's for development(which is a lot harder to grade) any team getting revenue sharing should probably get a minimum no matter what they are spending in payroll. And of course revenue sharing should be based upon market size.

Simply use the revenue sharing pool to make marginal revenue from wins closer from city-to-city.

Just to pull a random example, if the Pirates get $0 million from the revenue-sharing pool at 70 wins but they get $60 million for 90 wins, then there's a real economic incentive to make signing good, but expensive players.

In theory, hat would be ideal, but how do you determine who gets paid what for each win? Getting an estimate of "market size" that people can agree on would be hard, getting an agreeable estimate of marginal revenue per win is impossible.

Yes, they are doing things like adding full salaries for guys like Lugo who has only been with the Cardinals for part of the season, but this is how MLB calculates for the Luxury Tax threshold.

Wait, what? Is this true? So, if A-Rod were traded on April 2nd and then again July 31, all three teams, for purposes of calculating luxury tax, would have to include his full salary? Or when you say threshold, do you mean that only and not then to determine if a team is over that threshold?

If it's the former and it's true, I can't fathom how that got past the MLBPA.

I do think teams like the Pirates should be forced by the league to do some spending if there is a way to make it work.

One factor often overlooked by people who don't follow the Pirates - nobody wants to sign here. Over the past several years, the Pirates have had the highest bid on (and been turned down flat by) such luminaries as Daniel Cabrera, Luis Vizcaino, Paul Bako, Mike Koplove, and Will Ohman. They can't give their money away, even when they want to. The only ML FA they managed to sign last year was Eric Hinske, and he was so thrilled to be in Pittsburgh that he requested a trade in June.

That too easily becomes a self-fulfilling prophecy to allow it to overrule, and it's pretty easy to overcome. Let teams appeal whatever violation they're charged with under this "must spend" rule framework, and if they want to claim this as a mitigating factor, force them to produce evidence of good-faith offers to free agents that weren't accepted. You can allow them to show for both guys who took more elsewhere and those who took less in an effort to reduce gaming the system, and I can't imagine the MLBPA would have anything negative to say, even before you weigh in that the overall effect of the rule is beneficial to the players.

In theory, hat would be ideal, but how do you determine who gets paid what for each win? Getting an estimate of "market size" that people can agree on would be hard, getting an agreeable estimate of marginal revenue per win is impossible.

They do have 50 years of baseball economic data. Zimbalist did work that estimated MRP with far less access to the data than teams do.

Estimating value of a particular market isn't exactly an obscure task, after all!

Snapper/Matt:
Thanks for the correlation data. I would be inclined to exclude Baltimore and St Louis from this exercise, as Baltimore isn't nearly that good a market and St Louis for historical reasons is clearly not the 26th best baseball market. I suppose I'm cherry picking, but I really think those teams distort the real picture. If you do that the correlation is .59. One can debate whether that's big or small, but I'd say pretty big.

More important, I think, is what happens to the high and low payroll teams. Looking at the top and bottom quartiles (7 teams), the top teams average 86 wins and the bottom teams average 74 wins. In baseball, that's the difference between usually being in contention for the post-season and very rarely being in contention -- a huge gap.