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The price of efficiency: examining the effects of payroll efficiency on Major League Baseball attendance

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  • Colin Santos Regan

Abstract

From 1998 to 2008, the Oakland Athletics were the most payroll efficient team in Major League Baseball (MLB), recording the 5th highest win percentage despite having the 7th lowest payroll to work with. Their remarkable success has been widely attributed to the innovative strategies employed by general manager Billy Beane designed to identify undervalued statistics and players. However, these strategies also had the unintended effect of diminishing fan interest. An estimated 1600 fans per game were lost as a result of these payroll efficiency strategies, which produce teams composed of young, relatively unknown players and game tactics perceived as less exciting than more traditional approaches.

Suggested Citation

  • Colin Santos Regan, 2012. "The price of efficiency: examining the effects of payroll efficiency on Major League Baseball attendance," Applied Economics Letters, Taylor & Francis Journals, vol. 19(11), pages 1007-1015, July.
    • Handle: RePEc:taf:apeclt:v:19:y:2012:i:11:p:1007-1015
    DOI: 10.1080/13504851.2011.610735
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    References listed on IDEAS

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    1. Martin B. Schmidt & David J. Berri, 2001. "Competitive Balance and Attendance," Journal of Sports Economics, , vol. 2(2), pages 145-167, May.
    2. Leo Kahane & Stephen Shmanske, 1997. "Team roster turnover and attendance in major league baseball," Applied Economics, Taylor & Francis Journals, vol. 29(4), pages 425-431.
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    4. Karl W. Einolf, 2004. "Is Winning Everything?," Journal of Sports Economics, , vol. 5(2), pages 127-151, May.
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