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Beyond Moneyball

Author

Listed:
  • Joshua M. Congdon-Hohman
  • Jonathan A. Lanning

Abstract

This study examines the changes in player compensation in Major League Baseball during the last three decades. Specifically, we examine the extent to which recently documented changes in players’ compensation structure based on certain types of productivity fits in with the longer term trends in compensation and identify the value of specific output activities in different time periods. We examine free-agent contracts in 3-year periods across three decades and find significant changes to how players’ past performances are rewarded in free agency beyond the change in those to on-base percentage seen in the mid-2000s. We find evidence that the compensation strategies of baseball teams increased the rewards to “power†statistics beyond home runs in the 1990s from a model that focused on successfully reaching base with a batted ball without a significant regard for the number of bases reached. Similarly, we confirm and expand upon the increased financial return to bases on balls in the late 2000s as found in previous research.

Suggested Citation

  • Joshua M. Congdon-Hohman & Jonathan A. Lanning, 2018. "Beyond Moneyball," Journal of Sports Economics, , vol. 19(7), pages 1046-1061, October.
    • Handle: RePEc:sae:jospec:v:19:y:2018:i:7:p:1046-1061
    DOI: 10.1177/1527002517704019
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    More about this item

    Keywords

    compensation; incentives; labor markets; baseball;
    All these keywords.

    JEL classification:

    • J24 - Labor and Demographic Economics - - Demand and Supply of Labor - - - Human Capital; Skills; Occupational Choice; Labor Productivity
    • J31 - Labor and Demographic Economics - - Wages, Compensation, and Labor Costs - - - Wage Level and Structure; Wage Differentials
    • L83 - Industrial Organization - - Industry Studies: Services - - - Sports; Gambling; Restaurants; Recreation; Tourism

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