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12-09

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The CBA on Steroids
by
Doug Pappas

05-17

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Ticket Price Survey
by
Doug Pappas

05-11

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Ticket Price Survey
by
Doug Pappas

05-06

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Ticket Price Survey
by
Doug Pappas

04-30

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Ticket Price Survey
by
Doug Pappas

04-27

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Ticket Price Survey
by
Doug Pappas

04-21

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Fixing The Fan Cost Index
by
Doug Pappas

04-12

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Marginal Payroll/Marginal Wins
by
Doug Pappas

04-06

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Marginal Payroll/Marginal Wins
by
Doug Pappas

04-01

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Yankees' Stadium Dilemma
by
Doug Pappas

03-16

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Marginal Payroll/Marginal Wins
by
Doug Pappas

03-09

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Marginal Payroll/Marginal Wins
by
Doug Pappas

12-19

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The A-Rod Negotiations
by
Doug Pappas

11-21

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The Danys Baez Situation
by
Doug Pappas

10-06

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Marginal Dollars Per Win, 2003
by
Doug Pappas

09-29

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Predicting the Playoffs
by
Doug Pappas

07-17

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On the Mendoza Line
by
Doug Pappas

06-11

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The New CBA, Part II
by
Doug Pappas

06-03

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The New CBA, Part I
by
Doug Pappas

05-09

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The New CBA
by
Doug Pappas

04-25

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Bye Bye, Bud?
by
Doug Pappas

04-01

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Selig Yes, Zimbalist No
by
Doug Pappas

03-31

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As Seen In The New York Times Magazine
by
Doug Pappas

03-21

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Cognitive Dissonance
by
Doug Pappas

03-11

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Surveying the Authors
by
Doug Pappas

03-04

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Surveying the Authors
by
Doug Pappas

02-19

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Prospectus Feature: Where Does the Money Go?: Taking a Look at Major League Payrolls
by
Doug Pappas

01-22

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Prospectus Feature: The Midsummer Classic: Making it More Than Just an Exhibition Game
by
Doug Pappas

12-20

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Franchise Location
by
Doug Pappas

08-16

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Bridging the Gap
by
Doug Pappas

07-10

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DuPuy Disinforms
by
Doug Pappas

07-10

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DuPuy Disinforms
by
Doug Pappas

04-26

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Friday Afternoon with Bud
by
Doug Pappas

04-26

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Friday Afternoon with Bud
by
Doug Pappas

04-03

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Prospectus Feature: The Numbers (Part Eight): MLB vs. Forbes
by
Doug Pappas

04-03

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The Numbers (Part Eight)
by
Doug Pappas

03-20

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March Madness
by
Doug Pappas

03-20

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March Madness
by
Doug Pappas

03-13

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Prospectus Feature: The Numbers (Part Seven): Interest-ing
by
Doug Pappas

03-13

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The Numbers (Part Seven)
by
Doug Pappas

02-04

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The Numbers (Part Six)
by
Doug Pappas

01-24

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The Numbers (Part Five)
by
Doug Pappas

01-12

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The Numbers (Part Four)
by
Doug Pappas

12-20

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The Numbers (Part Three)
by
Doug Pappas

12-12

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The Numbers (Part Two)
by
Doug Pappas

12-07

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The Numbers (Part One)
by
Doug Pappas

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December 9, 2004 12:00 am

The CBA on Steroids

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Doug Pappas

Digging into the BP vault, here's Doug Pappas' Q&A on MLB's drug-testing and steroids policies (originally ran March 4, 2004).

Q. Where can I find a copy of MLB's drug testing rules?

A. They're part of Major League Baseball's Joint Drug Prevention and Treatment Program, set forth as Attachment 18 to the current collective bargaining agreement (CBA). The CBA, in .pdf format, can be downloaded here.

Read the full article...

May 17, 2004 12:00 am

Ticket Price Survey

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Doug Pappas

The fifth installment of the series tours the majors' largest division, the NL Central. Four of the six clubs in the division have moved into new ballparks since 2000, yet the one that's virtually sold out for the season is the one that plays in a 90-year-old park built for the Federal League. The Reds, Brewers and Pirates are Exhibits A, B and C for the proposition that a new ballpark doesn't ensure on-field success. Once again, I shopped the clubs' Web sites on MLB.com to see which seats a fan could hope to buy two or three weeks in advance, and how much a typical fan, or a typical family could expect to pay. That didn't work for the Cubs, who were sold out three months in advance, but everywhere else, typical fans are likely to pay less than Team Marketing Report's Fan Cost Index suggests they would.

The fifth installment of the series tours the majors' largest division, the NL Central. Four of the six clubs in the division have moved into new ballparks since 2000, yet the one that's virtually sold out for the season is the one that plays in a 90-year-old park built for the Federal League. The Reds, Brewers and Pirates are Exhibits A, B and C for the proposition that a new ballpark doesn't ensure on-field success.

Once again, I shopped the clubs' Web sites on MLB.com to see which seats a fan could hope to buy two or three weeks in advance, and how much a typical fan, or a typical family could expect to pay. That didn't work for the Cubs, who were sold out three months in advance, but everywhere else, typical fans are likely to pay less than Team Marketing Report's Fan Cost Index suggests they would.

Read the full article...

May 11, 2004 12:00 am

Ticket Price Survey

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Doug Pappas

Philadelphia Phillies Average ticket price: $26.08 (3rd in majors). 2003 attendance: 46.9% of capacity (24th in majors). Ongoing promotions: All season: "We're Finally Out Of The Vet." No discounts, but plenty of reasons to celebrate.

If you've read the first three installments of this series, you know the routine. Division by division, I'm shopping for tickets at MLB.com to see (a) how much fans can reasonably expect to pay for tickets at each ballpark, and (b) how many discounts and promotions are available for those who plan ahead.

Now up: the NL East.

Read the full article...

May 6, 2004 12:00 am

Ticket Price Survey

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Doug Pappas

In the third installment of this series, I review the ticket options for fans in MLB's smallest but most geographically dispersed division, the AL West. If you've read the first two installments (Part I, Part II), you know the drill. To simulate the average fan's experience, I pick a mid-week game, then shop for tickets on MLB.com a few weeks in advance. (I made an exception for Anaheim, choosing their next available mid-week series--since their next two mid-week visitors are the Yankees and Red Sox, I thought the earlier date would still be more representative.) First I shop for my imaginary family of four, whose ideal combination of price and view is usually behind the plate and towards the front of the upper deck. Then I pretend that my imaginary family just won the lottery, shopping instead for the best available block of four seats (as determined by MLB's ticket computer) anywhere in the ballpark. The seats available for the family of four serve as a rough proxy for the club's season-ticket and advance sales. Then I play Stranger Visiting Town, looking for a single seat. My expense-account alter ego shops for the best seat available through MLB.com, while his starving-student counterpart heads right for the cheapest seats in the park. Next, I scan the club Web sites for promotions that could reduce the cost of my hypothetical fans' attendance, as well as unusual promotions and giveaway items. Finally, I write a snappy summary and prepare to start the process all over again with another division.

If you've read the first two installments (Part I, Part II), you know the drill. To simulate the average fan's experience, I pick a mid-week game, then shop for tickets on MLB.com a few weeks in advance. (I made an exception for Anaheim, choosing their next available mid-week series--since their next two mid-week visitors are the Yankees and Red Sox, I thought the earlier date would still be more representative.)

First I shop for my imaginary family of four, whose ideal combination of price and view is usually behind the plate and towards the front of the upper deck. Then I pretend that my imaginary family just won the lottery, shopping instead for the best available block of four seats (as determined by MLB's ticket computer) anywhere in the ballpark. The seats available for the family of four serve as a rough proxy for the club's season-ticket and advance sales. Then I play Stranger Visiting Town, looking for a single seat. My expense-account alter ego shops for the best seat available through MLB.com, while his starving-student counterpart heads right for the cheapest seats in the park.

Read the full article...

April 30, 2004 12:00 am

Ticket Price Survey

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Doug Pappas

This is the second installment of my six-part survey of how much fans can actually expect to pay for tickets to major league games. I choose a mid-week game, then shop for tickets on MLB.com a few weeks in advance. First I look for a block of casual fan seats: ideally, four behind the plate and towards the front of the upper deck. These are usually, but not always, cheaper than the average price ticket used by Team Marketing Report to calculate the Fan Cost Index. Then I repeat the process three more times. Twice I look for the best available seats, as determined by the MLB.com ticket computer--once for a family of four and once for a single fan. The seats available for the family of four serve as a rough proxy for the club's season-ticket and advance sales, while the best single-seat option shows where a fan who doesn't care about the cost can sit without paying scalpers' prices. Finally, I look for the cheapest seats to find the lowest a fan using MLB.com could pay to get into the ballpark. To complete the survey, I check the club Web sites for promotions that could reduce the cost of my hypothetical fan's attendance, scan the club's promotional schedule for unusual events, and put it all together in the form below...

Then I repeat the process three more times. Twice I look for the "best available seats," as determined by the MLB.com ticket computer--once for a family of four and once for a single fan. The seats available for the family of four serve as a rough proxy for the club's season-ticket and advance sales, while the best single-seat option shows where a fan who doesn't care about the cost can sit without paying scalpers' prices. Finally, I look for the cheapest seats to find the lowest a fan using MLB.com could pay to get into the ballpark.

To complete the survey, I check the club Web sites for promotions that could reduce the cost of my hypothetical fan's attendance, scan the club's promotional schedule for unusual events, and put it all together in the form below:

Read the full article...

April 27, 2004 12:00 am

Ticket Price Survey

0

Doug Pappas

Last week I identified some of the problems with the "Fan Cost Index" developed by Team Marketing Report. One of the biggest issues, TMR's use of average ticket prices to calculate how much a typical family of four could expect to pay to see a game, has to be addressed on a team-by-team basis. This is the first of six articles that will do so. I'm starting with the AL East. My hypothetical customers decide a few weeks in advance which game they plan to attend, then shop for tickets on MLB.com. To keep the methodology constant, I'm ignoring any special knowledge I may have about a particular stadium's seats, seating and ticketing policies, and relying entirely on what I can find on MLB.com.

My hypothetical customers decide a few weeks in advance which game they plan to attend, then shop for tickets on MLB.com. To keep the methodology constant, I'm ignoring any special knowledge I may have about a particular stadium's seats, seating and ticketing policies, and relying entirely on what I can find on MLB.com.

For each game, I looked for four types of tickets. The most important, for these purposes, is a block of four "casual fan" seats--the ones that Team Marketing Report's hypothetical family would probably sit in. In checking out the options, I used my own seating preferences; in particular, I'd rather have a better angle on the action from the upper deck than a seat closer to the diamond but far down the lines. I went through the ticketing process up to the point where I was asked for my credit card, taking note of the service charges and processing fees that magically appeared along the way. (Since Team Marketing Report doesn't count these, neither did I.)

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Each year just before Opening Day, Team Marketing Report (TMR) releases the "Fan Cost Index" (FCI). According to TMR, the FCI "tracks the cost of attendance for a family of four." This year, TMR says this hypothetical family's day at the ballpark would cost an average of $155.52. The price would range from $108.83 in Montreal to $263.09 in Boston. If this sounds high, you're right. TMR defines the FCI to include two average-priced adult tickets and two average-priced children's tickets--but also two small draft beers, four small soft drinks, four regular hot dogs, two programs, two of the least expensive adult-sized adjustable caps, and parking for one car. In short, while it might reflect how much a family that decides on the spur of the moment to go to their one game of the season might spend, it far overstates the cost for most fans, who can easily eat before the game, sit in the cheap seats and skip the souvenir caps.

If this sounds high, you're right. TMR defines the FCI to include two average-priced adult tickets and two average-priced children's tickets--but also two small draft beers, four small soft drinks, four regular hot dogs, two programs, two of the least expensive adult-sized adjustable caps, and parking for one car. In short, while it might reflect how much a family that decides on the spur of the moment to go to their one game of the season might spend, it far overstates the cost for most fans, who can easily eat before the game, sit in the cheap seats and skip the souvenir caps.

One of the biggest weaknesses in the FCI is its use of "average-priced tickets" as a benchmark. By using the price paid by season-ticket holders for a particular seat, even if the price is higher when the seat is sold on a per-game basis, the FCI understates the cost of tickets for the average fan. Moreover, in many markets the "average-priced ticket" is irrelevant to the actual options available for casual fans attending a game on short notice, who must either buy from scalpers or wind up in the cheap seats. Last year 10 clubs sold fewer than half their available tickets, while the Giants, Cubs and Red Sox played to over 90% of capacity.

Read the full article...

After the 1991 season, Commissioner Fay Vincent used his annual State of the Game address to declare: "The present salary situation is out of hand and small-market franchises cannot compete in this environment." This in a year when the Minnesota Twins won the World Series, the Pittsburgh Pirates won their second of three consecutive NL East titles, and the Yankees finished 20 games under .500! In fact, of the four division winners, only Pittsburgh had even the third-highest payroll in its division. Toronto and Minnesota ranked fourth, while Atlanta ranked fifth.

Table 14. Marginal Payroll/Marginal Win, 1990

Team W L Pct Marg 8/31 MLB Marginal Marginal $/ Wins Payroll Payroll Marginal Win Baltimore 76 85 0.472 27.9 $8,087,702 $5,287,702 $189,713 Boston 88 74 0.543 39.4 $22,848,698 $20,048,698 $508,850 Cleveland 77 85 0.475 28.4 $15,394,298 $12,594,298 $443,461 Detroit 79 83 0.488 30.4 $17,848,737 $15,048,737 $495,024 Milwaukee 74 88 0.457 25.4 $18,453,999 $15,653,999 $616,299 NY Yankees 67 95 0.414 18.4 $20,592,948 $17,792,948 $967,008 Toronto 86 76 0.531 37.4 $18,193,500 $15,393,500 $411,591 California 80 82 0.494 31.4 $21,960,389 $19,160,389 $610,203 Chi WSox 94 68 0.580 45.4 $11,462,310 $8,662,310 $190,800 Kansas City 75 86 0.466 26.9 $23,617,090 $20,817,090 $774,854 Minnesota 74 88 0.457 25.4 $14,162,299 $11,362,299 $447,335 Oakland 103 59 0.636 54.4 $22,669,834 $19,869,834 $365,254 Seattle 77 85 0.475 28.4 $12,591,199 $9,791,199 $344,761 Texas 83 79 0.512 34.4 $12,803,035 $10,003,035 $290,786 Chi Cubs 77 85 0.475 28.4 $13,831,702 $11,031,702 $388,440 Montreal 84 77 0.522 35.9 $16,472,220 $13,672,220 $380,611 NY Mets 91 71 0.562 42.4 $22,229,333 $19,429,333 $458,239 Phldelphia 77 85 0.475 28.4 $14,156,000 $11,356,000 $399,859 Pittsburgh 95 67 0.586 46.4 $15,550,000 $12,750,000 $274,784 St. Louis 70 92 0.432 21.4 $19,647,498 $16,847,498 $787,266 Atlanta 65 97 0.401 16.4 $14,188,833 $11,388,833 $694,441 Cincinnati 91 71 0.562 42.4 $15,819,728 $13,019,728 $307,069 Houston 75 87 0.463 26.4 $18,229,781 $15,429,781 $584,461 LA 86 76 0.531 37.4 $20,943,107 $18,143,107 $485,110 San Diego 75 87 0.463 26.4 $16,718,332 $13,918,332 $527,210 San Fran 85 77 0.525 36.4 $22,456,224 $19,656,224 $540,006

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As the owners and players jockeyed toward another mid-season labor showdown, the owner of one of MLB's least efficient teams sought to set the record straight. Bud Selig announced: "The fact is, there are staggering cash operating losses in major league baseball today. ...The enormous cost increase in player salaries is, by far, the biggest reason baseball has dire economic problems. Any charge other than that is clearly and totally unsubstantiated by the economic facts as they exist today." MLB figures released after the season put the total of those "staggering cash operating losses" at less than 1% of revenue. In fact, player salaries had doubled since 1981. So had MLB's revenue, as cable TV became an increasingly important source of income. Owners who reinvested their rights fees in payroll helped create a $300,000 gap between the major league minimum and the average salary. As the Braves and Pirates demonstrated, badly-run franchises could now waste more money than ever before.

Table 9. Marginal Payroll/Marginal Win, 1985

Team W L Pct Marg 8/31 Marg Marg $/ Wins Payroll Payroll Marg Win Baltimore 83 78 0.516 34.9 $12,371,429 $10,691,429 $306,208 Boston 81 81 0.500 32.4 $11,080,695 $9,400,695 $290,145 Cleveland 60 102 0.370 11.4 $6,623,133 $4,943,133 $433,608 Detroit 84 77 0.522 35.9 $10,850,643 $9,170,643 $255,295 Milwaukee 71 90 0.441 22.8 $12,216,965 $10,536,965 $461,318 NY Yankees 97 64 0.602 49.0 $15,398,047 $13,718,047 $279,946 Toronto 99 62 0.615 51.0 $11,800,281 $10,120,281 $198,379 California 90 72 0.556 41.4 $11,559,593 $9,879,593 $238,638 Chi WSox 85 77 0.525 36.4 $9,849,689 $8,169,689 $224,442 Kansas City 91 71 0.562 42.4 $11,754,512 $10,074,512 $237,606 Minnesota 77 85 0.475 28.4 $7,238,667 $5,558,667 $195,728 Oakland 77 85 0.475 28.4 $10,008,823 $8,328,823 $293,268 Seattle 74 88 0.457 25.4 $5,549,870 $3,869,870 $152,357 Texas 62 99 0.385 13.8 $8,101,222 $6,421,222 $465,809 Chi Cubs 77 84 0.478 28.9 $13,478,225 $11,798,225 $408,550 Montreal 84 77 0.522 35.9 $10,195,246 $8,515,246 $237,050 NY Mets 98 64 0.605 49.4 $11,013,714 $9,333,714 $188,942 Phldelphia 75 87 0.463 26.4 $11,785,445 $10,105,445 $382,782 Pittsburgh 57 104 0.354 8.8 $10,223,945 $8,543,945 $976,001 St. Louis 101 61 0.623 52.4 $10,441,639 $8,761,639 $167,207 Atlanta 66 96 0.407 17.4 $14,771,382 $13,091,382 $752,378 Cincinnati 89 72 0.553 41.0 $9,258,848 $7,578,848 $185,063 Houston 83 79 0.512 34.4 $10,153,335 $8,473,335 $246,318 LA 95 67 0.586 46.4 $11,970,412 $10,290,412 $221,776 San Diego 83 79 0.512 34.4 $9,801,052 $8,121,052 $236,077 San Fran 62 100 0.383 13.4 $7,777,945 $6,097,945 $455,071

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In the wake of Commissioner Selig's latest declaration that the 36-year-old Oakland Coliseum "cannot produce enough revenue for [the Athletics] to be competitive," more attention should be paid to another perennial contender in a similar plight. If recent trends continue, the New York Yankees will soon need a new ballpark to remain competitive.

In the wake of Commissioner Selig's latest declaration that the 36-year-old Oakland Coliseum "cannot produce enough revenue for [the Athletics] to be competitive," more attention should be paid to another perennial contender in a similar plight. If recent trends continue, the New York Yankees will soon need a new ballpark to remain competitive.

As shown below, the Yankees' Opening Day payroll has nearly doubled in the four seasons since their last world title:

Read the full article...

The 1980 season opened under the cloud of a threatened mid-season labor stoppage. In March the players voted 973-1 to strike if the owners persisted in their demand that a club losing a free agent receive a major league player from the signing club as compensation--in effect converting the signing of a free agent into the equivalent of a trade. Hours before the strike deadline, the parties settled all other issues and agreed to revisit the compensation issue the next year. On the diamond, the Philadelphia Phillies rode their league-leading payroll to their first (and so far only) World Championship. Owner Ruly Carpenter blames himself and his fellow owners for rising salaries, noting that "no court can compel you to spend millions on players." For proof, Carpenter needed to look no further than Oakland's Charles O. Finley, who rode the majors' lowest payroll to an 83-79 record in the year of Billyball.

Table 4. Marginal Payroll/Marginal Win, 1980

Team W L Pct Marg 8/31 Marg Marg $/ Wins Average Payroll Marg Win Baltimore 100 62 0.617 51.4 $116,156 $2,412,368 $46,933 Boston 83 77 0.519 35.4 $184,686 $4,331,208 $122,221 Cleveland 79 81 0.494 31.4 $127,505 $2,730,140 $86,982 Detroit 84 78 0.519 35.4 $86,988 $1,595,664 $45,075 Milwaukee 86 76 0.531 37.4 $159,086 $3,614,408 $96,642 NY Yankees 103 59 0.636 54.4 $242,937 $5,962,236 $109,600 Toronto 67 95 0.414 18.4 $67,218 $1,042,104 $56,636 California 65 95 0.406 17.2 $191,014 $4,508,392 $261,925 Chi WSox 70 90 0.438 22.3 $72,415 $1,187,620 $53,316 Kansas City 97 65 0.599 48.4 $100,453 $1,972,684 $40,758 Minnesota 77 84 0.478 28.9 $80,358 $1,410,024 $48,826 Oakland 83 79 0.512 34.4 $54,994 $699,832 $20,344 Seattle 59 103 0.364 10.4 $82,244 $1,462,832 $140,657 Texas 76 85 0.472 27.9 $148,792 $3,326,176 $119,337 Chi Cubs 64 98 0.395 15.4 $160,209 $3,645,852 $236,744 Montreal 90 72 0.556 41.4 $158,196 $3,589,488 $86,703 NY Mets 67 95 0.414 18.4 $126,488 $2,701,664 $146,830 Phldelphia 91 71 0.562 42.4 $221,274 $5,355,672 $126,313 Pittsburgh 83 59 0.585 46.1 $199,185 $4,737,180 $102,781 St. Louis 74 88 0.457 25.4 $173,480 $4,017,440 $158,167 Atlanta 81 80 0.503 32.9 $147,989 $3,303,692 $100,407 Cincinnati 89 73 0.549 40.4 $162,655 $3,714,340 $91,939 Houston 93 70 0.571 43.8 $176,720 $4,108,160 $93,731 LA 92 71 0.564 42.8 $183,124 $4,287,472 $100,091 San Diego 73 89 0.451 24.4 $138,978 $3,051,384 $125,057 San Fran 75 86 0.466 26.9 $148,265 $3,311,420 $123,258

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The oft-recited assertion that "small markets can't compete" in Major League Baseball is usually supported by a table showing that "winners" like the Yankees, Dodgers, and Red Sox spend far more on players than "losers" like the Devil Rays, Pirates, and Brewers. This argument is misleading in at least three respects. First, "small market" is often mistakenly used as a synonym for "low revenue." A team's revenue, and the size of the payroll it can support, is far more dependent on its recent success (and the terms of its stadium lease) than on the size of its market. According to MLB's official revenue figures for 2001, the Seattle Mariners took in more money than any other club except the Yankees--over three times as much as the Florida Marlins, who play in a larger market. Playing in a 35-year-old stadium, the Cardinals outgrossed Baltimore, Philadelphia and Detroit, all of which occupy markets at least twice the size of St. Louis. Cleveland and Minneapolis-St. Paul are almost exactly the same size, but the Indians grossed $100 million more than the Twins. Second, a snapshot of one season's "winners" and "losers" ignores the ebb and flow of team fortunes. If Major League Baseball had proposed contraction 10 years earlier, the Indians and Mariners would have been among the leading candidates for extermination. The Oakland Athletics, heroes of Moneyball for doing more with less, had the majors' highest Opening Day payroll in 1991, the same year the Pirates won their third division title in a row. Over the past 20 years, the Padres and Twins have played in more World Series than the Dodgers or Red Sox. Most tellingly of all, the original list of eight clubs considered for contraction, prepared in December 2000, included all three of the clubs which have won the World Series since then. Third, and most importantly, some teams are better run than others.

The oft-recited assertion that "small markets can't compete" in Major League Baseball is usually supported by a table showing that "winners" like the Yankees, Dodgers, and Red Sox spend far more on players than "losers" like the Devil Rays, Pirates, and Brewers. This argument is misleading in at least three respects.

First, "small market" is often mistakenly used as a synonym for "low revenue." A team's revenue, and the size of the payroll it can support, is far more dependent on its recent success (and the terms of its stadium lease) than on the size of its market. According to MLB's official revenue figures for 2001, the Seattle Mariners took in more money than any other club except the Yankees--over three times as much as the Florida Marlins, who play in a larger market. Playing in a 35-year-old stadium, the Cardinals outgrossed Baltimore, Philadelphia and Detroit, all of which occupy markets at least twice the size of St. Louis. Cleveland and Minneapolis-St. Paul are almost exactly the same size, but the Indians grossed $100 million more than the Twins.

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