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Articles Tagged Draft Pick Compensation 

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November 1, 2006 12:00 am

Future Shock: The CBA and the Draft

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Kevin Goldstein

Kevin talks about some of the major implications the new CBA portends for the player development side of the industry.

The Deadline

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June 9, 2006 12:00 am

Future Shock: NL Draft Notebook

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Kevin Goldstein

Kevin now turns to the National League for a quick recap of how each team made out with their first few picks.

Arizona Diamondbacks

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November 30, 2005 12:00 am

The BP Guide To Transaction Rules

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Thomas Gorman

Part Two of our transaction series explains the rules governing compensatory draft picks, and focuses on two Bay Area GMs who use the rule to different ends.

Compensatory Draft Picks

Most serious fans of baseball are familiar with the compensatory draft pick rule of the CBA, even if they don't understand all of its details. Oakland Athletics General Manager Billy Beane is famous for snatching up free agents in the last year of their contracts so that he can hoard these picks. San Francisco Giants GM Brian Sabean is famous for signing free agents so that he can get rid of his draft picks. What are the details of this important CBA provision?

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August 25, 2005 12:00 am

Lies, Damned Lies: Valuing Draft Picks

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Nate Silver

All draft picks have a value that can be quantified. Using some of the tools he employed last time out, Nate takes a crack at doing just that.

For example: what is the value of a first-round draft pick? This is an essential thing for a baseball club to have a handle on. Under baseball's compensation rules, a team signing a Type A free agent must sacrifice its first-round draft pick (or its second-round pick, if it picks in the top half of the first round), while a team losing the same free agent acquires that first-round pick, as well as a sandwich pick between the first and second rounds. If the value of these picks is material--above and beyond the signing bonus that would typically be paid to a draft pick--that ought to have a corresponding impact on a team's behavior in the free-agent market.

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I'm going to look at the 2000 draft, which is far enough back that we can make some conclusions about how the acquisitions turned out, and how the teams dealt with draft compensation.

I've been doing a lot of work on draft compensation lately. It was supposed to die in the last labor agreement, but it didn't, and it provides a great insight into a team's approach and overall intelligence. James' basic tenet remains true, but I've come to believe the issue is much more complicated.

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