Friday, September 14, 2012

Big Money Ball: Is Spending a Ton the Way to Win in MLB?

On Wednesday, USA Today ran a story stating MLB teams that are spending more this season aren't necessarily going to make the playoffs.  And in fact if the season ended right now, only one of the top five spenders in MLB (the New York Yankees) would make the playoffs, and that's with ten total playoff spots as opposed to the eight that were used from 1995 to 2011.  

White Sox chairman Jerry Reinsdorf is quoted in USA Today's article as saying that, "'I think it's an aberration, I really do.  In order to win consistently, you have to have a reasonably high payroll.  You don't have to be in the (New York) Yankees' or (Boston) Red Sox's class, but I don't think you can win consistently with a real low payroll.'"

I think what Reinsdorf said about not having to be in the same (spending) league as the Yanks and BoSox is accurate.  Let's take a look at the facts.

The Yankees moved into MLB's top payroll spot in 1999 and have been there ever since.  But they've won just one World Series since beating the Mets in 2000, and if you take a look at the MLB champs over that span, the results suggest a that an enormous payroll isn't the magic formula to ultimate success.  

In 2003, the Yankees and Marlins faced off in the Fall Classic, with Florida taking the Series.  Florida's payroll that season: $48.8 million, the 25th-highest payroll in all of baseball and a little less than a third of the Yankees total salary of $152.8 million.  

Maybe the Marlins winning with such a comparatively low payroll is an aberration itself, but since the Yanks' Subway Series victory, just five teams with top ten payrolls have won the World Series, and only the 2004 Red Sox, 2007 Red Sox, and 2009 Yankees had a total salary that ranked in the top five. Plus, the average rank in salary of the World Series winners from 2001 on is 9.91.  

And spending the biggest doesn't even necessarily mean you'll make the playoffs.  Unless at least four of the top five spenders this season (Yankees, Phillies, Angels, Red Sox, and Tigers) find a way to get into the postseason, 1999 is the only year in the last 13 MLB seasons that any more than three of the top five spenders made the playoffs (all five of the top five spending teams made the postseason that year).

So it looks like the formula to winning in MLB isn't spending all you have.  Maybe it used to be.  Back in the late '90s, the big-spending Yanks won four World Series in five years, and from 1995 to 2000, the average salary rank of the World Series victors was 2.5.  But the numbers don't lie: Shelling out big bucks doesn't necessarily mean success in today's MLB.

**Note: All raw data about salaries that was used for this blog post came from USA Today's salary database.  I'm not sure exactly what point in the season the payrolls on that site are from, so salary and salary rank could be different from what I wrote in the post.  All raw data about postseason play came from  Information about who would be in the playoffs if the season ended right now was taken from

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