Archive for Book Review

Baseball Prospectus Interview about Hot Stove Economics

David Laurila interviews me about Hot Stove Economics at Baseball Prospectus.

Here’s an excerpt.

DL: Do the luxury tax and revenue sharing work?

JCB: My thought is that there are some very real negative incentives created by it, which cause bad teams, particularly bad losing teams, to continue to lose. There is a disincentive to win, because winning would mean you’re not going to get the revenue sharing that you were once getting.

One of the things that I find in my estimating-revenue function, which includes revenues from revenue sharing, is that at very low levels for bad teams there is actually a revenue bump. I call it the loss trap. It shows that as you lose games, you can increase your revenue. That’s consistent with the economic incentives created by the welfare system—you realize that if you better yourself with work, you’re going to get less of the welfare transfer, so you have little incentive to work.

I don’t think that many teams are actually trying to exploit this revenue bump, but what it does demonstrate is that if you’re very bad, and the high returns to winning don’t kick in until teams are earning in the mid-80s of wins, in revenue, you have teams that are winning 70 games saying, “I don’t want to fall off into the abyss and become a really horrible team, but there’s really not a huge incentive to get better if I can sit here and get fat off of revenue sharing.” The documents that were released this summer seemed to indicate that is what some teams were doing.

Part II will be posted on Wednesday is now posted. Thanks to David for conducting the interview

The Bullpen Gospels (a Review)

Last week, I mentioned that I had ordered The Bullpen Gospels by Dirk Hayhurst and that I would soon write a review. I found a copy at my local Borders on Thursday, and I was done by Saturday. I normally read books slowly in my spare time, but I had trouble putting this one down. That was from my Twitter feed on Saturday afternoon:

@jc_bradbury

Just finished The Bullpen Gospels, one of the best personal narratives I’ve ever read.

The Bullpen Gospels is better than it has to be. I expected no more than a fun and straightforward account of life in minor-league baseball: first-hand stories of pranks and celebration, boredom and failure, maybe even some dirt. The book does contain those things—with one notable exception: dirt—but they are just the backdrop for a bigger and more interesting story about a particular minor-league player. The baseball content alone should make The Baseball Gospels a good book, but Hayhurst takes his story deeper to write a great book.

I expected the book to be a minor-league Ball Four, but it has more in common with Zen and the Art of Motorcycle Maintenance. Baseball serves as a backdrop for a deeply personal narrative that almost anybody can relate to. It turns out that the inner struggles faced by baseball players are not much different than struggles we all have. But through the lens of a minor-leaguer with a less-than-perfect life—this is a guy who’s living a dream denied to so many die-hard fans—the reader sees how a young man struggles to battle his “what am I doing with my life?” daemons that trouble us all.

At the beginning of the book, Hayhurst hasn’t come to terms with his own status of being worshiped and hated by others. Handing out autographs to people who don’t know who he is becomes hollow after a while. He’s got an alcoholic brother, a crippled father who can’t accept his fate, and a mother who tries to hold it all together by pretending that everything is fine. To Hayhurst, baseball has always been an escape, but moving from prospect to roster-filler status has soured his love for the game. He keeps his family at a distance, yet desperately craves their approval. Baseball seems to be his only life-path.

Hayhurst is an interesting character, a 26-year-old virgin who doesn’t drink, but appears to be right in the middle of all the people you’d think he’d avoid. He lives in the heart of a raunchy world where young men have a lot of time to kill and need more than mild entertainment to cure their boredom. Yet, Hayhurst appears to fit right in, embracing the lifestyle without booze or sex, shocking most teammates when they learn he’s sober. It’s as if they didn’t notice that he was the only one with a soft drink at the party. Yet, Hayhurst revels in the misbehavior of others, as he laughs along with drunken binges, slump busters, practical jokes and kangaroo court that fans aren’t privy to. Yeah, it looks like good time.

Yet, in the middle of all this fun Hayhurst is confused, even as he begins to figure things out. Caught between having too much and too little self-confidence, he slowly begins to find a balance. If he’s going to make a run for the big-leagues, might as well do it now. He cares about winning, but he can’t win unless he stops caring about winning; it’s a koan where he finds peace. He eventually finds his chief enemy in a vision akin to Luke Skywalker’s visit to the Dark Side cave on Dagobah (there are several Star Wars references in the book). He doesn’t believe in the baseball gods, he has to appease his personal baseball reaper.

What makes this book work is not the baseball, psychology, or philosophy; it’s the writing. Most athletes who hire ghostwriters to pen their “autobiographies” don’t get writing as good as Hayhurst’s. He leads the reader to the inevitable only to reveal the unexpected. I frequently laughed out loud as a joke appeared from nowhere. His speaks fondly of his teammates and coaches, empathizing with them. And he disguises names to keep potentially embarrassing moments private. This book isn’t about dishing out dirt. And even as the book ends with great success—Hayhurst makes it to the big leagues—the success is an afterthought. It’s as if he said, “Oh yeah, I made it; but, that’s not important.”

A good book is one you that can’t wait to finish but fear its end, and that is how I felt about this book. I especially recommend this book to young adults trying to find their place in this world. Living on little for the hope of so much more is frustrating, and Hayhurst accurately documents the experience. If you are looking for a description of life in the minor leagues, you’re going to find it here, but you’re also going to find so much more. The Bullpen Gospels is a soon-to-be classic, and should be coming to a movie theater near you.

Pitch Count Contest

I haven’t done a contest in a while, and I’ve got a copy of Stumbling on Wins by David Berri and Martin Schmidt to give away. If you’d like to win a copy, answer the following question correctly.

From 1988 to 2009, by how many pitches did the median number of pitches thrown in a game by starters change?

Put your answer in the comments. One entry per person. First commenter with the right answer wins a free copy of the book. As with all contests here, I reserve the right to arbitrate unforeseen circumstances as I see fit.

The Bullpen Gospels

I’ve just run across a new book that looks quite interesting, The Bullpen Gospels: Major League Dreams of a Minor League Veteran by Dirk Hayhurst.

From the publisher:

From the humble heights of a Class-A pitcher’s mound to the deflating lows of sleeping on his gun-toting grandmother’s air mattress, veteran reliever Dirk Hayhurst steps out of the bullpen to deliver the best pitch of his career—a raw, unflinching and surprisingly moving account of his life in the minors.

I enjoyed the visualizations, maybe a little too much, and would stop only when I felt I’d centered myself…or after one of my teammates hit me in the nuts with the rosin bag while my eyes were closed.

Hilariously self-effacing and brutally honest, Hayhurst captures the absurdities, the grim realities, and the occasional nuggets of hard-won wisdom culled from four seasons in the minors. Whether training tarantulas to protect his room from thieving employees in a backwater hotel, watching the raging battles fought between his partially paralyzed father and his alcoholic brother, or absorbing the gentle mockery of some not-quite-starstruck schoolchildren, Dirk reveals a side of baseball, and life, rarely seen on ESPN.

My career has crash-landed on the floor of my grandma’s old sewing room. If this is a dream come true, then dreams smell a lot like mothballs and Bengay.

Somewhere between Bull Durham and The Rookie, The Bullpen Gospels takes an unforgettable trot around the inglorious base paths of minor league baseball, where an inch separates a ball from a strike, and a razor-thin margin can be the difference between The Show or a long trip home.

Looks like a Ball Four of the minor leagues. I ordered it earlier this week and will write a review when I’m done.

For those of you who want to know more about the book, I interviewed one of Hayhurst’s former teammates Brent Carter several years ago. Here is a sample.

JC: Tell me what it’s like to be a minor league ballplayer. Is it fun, or does it get old?

BC: Being a minor leaguer is not what it’s made out to be. You hear stories about the long bus rides, crappy hotels, etc. But it’s really a blast. The friendships you make, playing against the stars of tomorrow, being only a couple of levels away from your childhood dreams unfolding in front of you. I would not trade this for anything.

Carter now has the distinction of playing with two famous subjects of baseball literature. He was a college teammate of Moneyball‘s Jeremy Brown.

What Will Kelly Johnson Hit Next Year?

According to the 2010 Bill James Handbook, Kelly Johnson projects to hit .274/.354/.445. That sounds about right to me. It’s also better than Jeff Francoeur’s .276/.318/.437, but I still think the Mets wouldn’t have taken KJ for Ryan Church—their loss, our gain.

If you want to see some more projections, I have posted projections for all hitters and pitchers (with permission).

UPDATE: Sorry, if you came here looking for the file. A representative at ACTA publishing asked me to remove the link. I was told it was OK to post the file, but apparently they have changed their minds.

Hitter and Pitcher Projections from The Bill James Handbook 2010

I always enjoy thumbing through The Bill James Handbook.

(FTC disclosure: Free review copy)

The Fielding Bible II: Runs Saved

I didn’t have more than a few minutes to glance through The Fielding Bible II last night, but I see nothing but improvements to what I already considered to be baseball’s best defensive measurement system. If you want to evaluate fielding, then you should be using The Fielding Bible.

Here is an excerpt that describes the newest Plus/Minus-based metric Runs Saved and lists the leaders by position for the past three seasons.

Here are the best defenders by position in terms of total Runs Saved from 2006–2008.

Pos.	Player		Runs Saved
1B	Albert Pujols	61
2B	Chase Utley	63
3B	Pedro Feliz	50
SS	Adam Everett	48
LF	Alfonso Soriano	42
CF	Carlos Beltran	44
RF	Alex Rios	49
C	Jason Kendall	27
P	Kenny Rogers	27

The Fielding Bible II

I just received a copy of The Fielding Bible II in the mail today from ACTA Publishing. I can’t wait read through it. I loved the first edition, and I think highly of the Plus/Minus System. In fact, Hal Richman’s cover blurb says exactly what I think of the system.

John Dewan’s Plus/Minus System is the best statistical system I’ve ever seen for evaluating the defensive abilities of Major League Baseball players.

I will write more about the book as I read it.

Gifts for the Baseball Analyst

I’ve got family coming in and out of town over the next two weeks, so I’m not planning to post much (if at all) during this time. I thought I’d leave you with a list of gifts for the baseball analyst. These are the books that I recommend.

Introduction
Moneyball by Michael Lewis — A good introduction to the big picture.
The Numbers Game by Alan Schwarz — The entire history of baseball analysis. I reference it frequently.

Intermediate
Whatever Happened to the Hall of Fame by Bill James — A good introduction to the objective analysis of Bill James.
Baseball Between the Numbers by Baseball Prospectus — A good introduction to sabermetrics. I don’t agree with everything in the book, but it offers good coverage modern sabermetrics.
The Baseball Economist by J.C. Bradbury — If you want to know what I think. :-)

Advanced
Curve Ball by Jim Albert and Jay Bennett — An easy-to-read introduction to the application of statistics to baseball by two statisticians. A must for the serious baseball analyst.
Baseball’s All-Time Best Sluggers by Michael Schell — The best treatise on hitting ever written, by a UNC biostatistics professor who grew up in my neighborhood and played in my Little League (we didn’t know each other, though). This is not light reading.
Baseball Hacks by Joseph Adler — A guide to acquiring and organizing baseball data from the web.

I wish you a happy an safe holiday season.

Understanding Randomness: The Drunkard’s Walk

Few things annoy me more than when people insist that an outcome must be attributable to some easily-identifiable cause. Life is full of randomness, why can’t people admit this? It may not satisfying answer, but it is frequently the correct answer.

A few weeks ago I was watching a baseball game, when a historically-bad relief pitcher entered the game. Instead of giving up a walk and a few hits, capped off with a homer, he recorded three straight outs. No doubt, this performance was well within the range of expected outcome for this pitcher: outs are common in baseball, and even the worst pitchers frequently record three straight outs. But, this couldn’t have been the answer to the announcer, oh no. “That extra side-work he’s been doing with the pitching coach must have paid off,” we were told.

As I was restraining myself from yanking my hair out in tufts, I glanced over at my copy of The Drunkard’s Walk: How Randomness Rules Our Lives by Leonard Mlodinow and thought of sending it to the offending announcer. It was recommended to me by a blog reader, and I have enjoyed reading it. Mlodinow, coauthor of A Brief History in Time with Stephen Hawking, uses his own life experience to explain the mathematical history of randomness while explaining its practical applications.

While it’s the type of book that I like, it may have some additional attraction to baseball fans. Mlodinow is clearly a baseball fan as he uses some baseball historical events to explain randomness. For example, he estimated likelihood of the Braves blowing the 1996 World Series to the Yankees….like I needed reminding. Though the baseball examples are few, they are appreciated.

One of the nice book features is the explanation of difficult concepts through simple examples, without resorting to typical mathematical notation. You may been exposed to these concepts before in a probability and statistics class, but the answer was difficult to grasp among the lines and symbols. In fact, if you know someone taking such a class, the book should clarify and reinforce many of the concepts learned in the course. If you’re a fan of pop-science books, then I think you might like as well.

Responding to Zimbalist

Today, Maury Brown has posted Andrew Zimbalist’s review essay of The Baseball Economist along with Vince Gennaro’s Diamond Dollars. This essay is to be featured in the next issue of the Journal of Economic Literature.

I am open to criticism, and I feel that my book is subject to many reasonable objections. After all, if I thought everyone would agree with the entire content, there would have been little reason to write it. I have had many meaningful conversations with readers about the content of my book. Even I have some concerns about things that I have previously written. However, Zimbalist’s critique is lacking and borderline dishonest in several places. Believe me, I take no joy in dismantling a negative review, but several of Zimbalist’s incorrect claims force me to respond.

Below, I detail several parts of Zimbalist’s review of my book (Vince can defend his own work) and add my responses. In many cases it is clear that Zimbalist failed to even read the book. In other criticisms, he is just wrong. I follow the order of his review, and though I do not respond to everything, I cover enough to show most of his concerns are without merit.

On umpire rent-seeking, Zimbalist writes:

Bradbury’s chapter on whether it pays for a manager to argue with the umpire is provocative, but unsatisfying….It is rent seeking because there is no net gain, no output increase, just a transfer of marginal calls from one team to another. Meanwhile, the fans, according to Bradbury, have their utility lowered because they have to spend a few extra minutes at the game due to these fits of managerial distemper. Well maybe, but it is also possible that the fans enjoy managerial protests both because they are amusing and because it vicariously vents their own frustration at bad umpire calls.

Fair enough, it’s not my favorite chapter, either. The point of the chapter was to teach the concept of rent-seeking using baseball instead of typical boring classroom examples. I don’t think it’s a policy issue of great importance, and there is no doubt that it is my own preference that arguing be removed from the game.

On the big-city-versus-small-city discussion, Zimbalist writes:

Bradbury’s simple regression finds that variance in city size accounts for 40 percent of the variance in win percentage over a period of years. This seems to indicate a rather substantial impact of city size. Further, the author fails to consider the interactive effect of city size and a team owning its own regional sports channel (RSN), the number of large corporations in the market, or the size of MLB’s assigned team television market – three factors that would have reinforced the effect of city size.

The regression I report is simple because of the numerous potential control variables that I included, did not show any effect. And with only 30 teams, my degrees of freedom were approaching/surpassing the minimum. I looked at income, split the markets with multiple teams in two, and included multiple team dummies. For this reason, I did not report the results. I admit to not including a dummy variable or interactive term for whether or not a team owned its own RSN. This is endogenous—having an RSN to generate money that leads to wins is something that any team could do, regardless of its size. Better-managed teams won out over those that did not. I have no doubt that TBS helped the Braves improve their financial standing beyond what Atlanta ticket-holders produced, but that is the point: population wasn’t the cause. I’m not sure how this cripples the regression estimates or affects the supporting material in the chapter that doesn’t rely on the regression estimates to support the point that big-market advantage is overblown.

Zimbalist continues:

Along the way, Bradbury misapprehends the functioning of the amateur draft and overlooks the unequalizing effect of the posting system with Japanese baseball.

I’m not sure what I missed with the draft, nor how the posting system drastically alters what I reported. But, as you will soon see, Zimbalist likes to drop these bombs and run.

Zimbalist doesn’t like my application of the prisoner’s dilemma to explain the incentives for steroid use in baseball.

His chapter on steroids in baseball employs game theory to model the choice that a player makes whether or not to indulge. He argues that when every player chooses to use steroids it is a Nash equilibrium. This result, however, appears to depend on his arbitrarily chosen values for the supposed productivity gain and the health costs (only $500,000) from indulgence. Bradbury’s analysis ignores the enormous uncertainty that surrounds this choice for players.

As it happened with the rent-seeking chapter, Zimbalist forgets that I am using an issue in baseball to introduce readers to an important economic concept. The example I use includes hypothetical, not actual, payoffs to help elucidate the incentives faced by players. Of course the payoffs affect the choice. I designed the matrix to explain how a prisoner’s dilemma operates. This is very clear in the text. If he has an argument as to why this is inappropriate to model this decision as a prisoner’s dilemma game, I would like to hear it.

I ignore uncertainty? How does this affect the outcome in a relevant way? As Zimbalist ought to know, any game theory model can be tweaked with numerous assumptions that drastically alter the results. I’m not sure what type of uncertainty here is going to allow players to unilaterally decide to quit using steroids. I’m all for seeing alternate models, but I think the standard PD model works well.

On the invention of new statistical methods for scouting baseball players, Zimbalist writes:

On page 147, for instance, Bradbury writes: “Old ways and old scouting methods may disappear, but the end result is a good one for the fan: better and cheaper baseball.” No team is contemplating the elimination of traditional scouting methods, nor is one likely to in the future. New statistical methods have been employed to supplement, not supplant, traditional scouting.

Here, Zimbalist takes my words out of context and ignores my direct commentary on the issue.

TBE, p. 144.

Am I predicting an end to traditional scouting? I sincerely doubt that any baseball team, including any team run by Billy Beane, will ever abandon personal scouting. No matter how far the knowledge of scouting progresses, there will always be things that the stats will miss. No matter how far the knowledge of predicting talent progresses, there will always be things that the stats will miss. Teams can learn from statistics what information they really need from scouts, and statistics can make scouts more effective…. [Skipping over a detailed example of how pure stats scouting will fail]…Statistical analysis does not eliminate the need for on-site scouting, but the role of the scout may be reduced and modified to focus on different things.

I then go on to discuss that the development of new statistics is just one area where some teams innovated, and I point out that scouting-centric organizations like the Twins, Marlins, and White Sox have also experienced success on small budgets.

The quote that Zimbalist plucks from the end of the chapter is in reference to a discussion of “creative destruction”—the replacement of old and inefficient methods with new technology. I am explaining why the change is a good thing, and that if and when some scouting methods become obsolete that this is all part of a positive process.

On clutch hitting, Zimbalist asserts that I am not backing up my claims and that my arguments are inconsistent:

“The problem is that hitting with RISP is not a skill … but a statistical anomaly.” (p. 155) “If hitting with RISP is something a hitter can purposely alter, I have a hard time believing he is holding something back in non-RISP situations” (p. 156). There you have it – there is no such thing as clutch hitting.

Yep, “there you have it.” That is it, I just state this and keep on moving…What? Oh wait, there is an endnote (67) listed at the end of the sentence quoted on page 155? Why, whatever could it say?


TBE
, p. 320.

67. Statisticians Jim Albert and James Bennett find minimal evidence for clutch ability in these situations, and any observed effect is very weak (Curve Ball, 2001).

There you have it! Though I didn’t go into great detail on the existence of clutch play in athletics—I decided against diverting the chapter from its main goal to discuss “clutch” play—the endnote that I provide is sufficient.

Zimbalist continues:

This is an awfully linear, materialist view of the world where a player’s emotions and his state of physical depletion over a 162-game season play no role.

Linear? Maybe. Materialist? This doesn’t even make sense. Are we referring economics or metaphysics? As best as I can figure, I think he’s referring to the kind that is opposed to idealism. Still, I can don’t see how being a materialist denies clutch hitting.

Zimbalist continues:

Further, Bradbury is being inconsistent. In his chapter about the on-deck batter, he asserted that a pitcher can ramp it up and pitch more carefully and effectively to the current batter when a strong batter is on deck. So, in Bradbury’s world, pitchers can focus and pitch in the clutch, but hitters can’t turn the same trick.

There is nothing inconsistent about this position, which I do hold. In fact, I have discussed it many times with many people. Pitching and hitting are very different skills. Pitchings requires a player to regulate his effort to remain in the game. A batter swings the bat then sits down for a while.

Zimbalist doesn’t like my analysis of a curious finding in Moneyball.

Later in the chapter, Bradbury endorses the proposition from Moneyball that on-base percentage (OBP) is three times as important as slugging percentage (SLG). He arrives at this outcome by running a multiple regression of runs on batting average, OBP and SLG. The coefficient on OBP is almost three times that on SLG. The problem here is not only that the arguments are collinear and the coefficients are less reliable, but that SLG (it counts a homerun as four hits, a triple as three, etc.) is a much higher number than OBP. The coefficient, therefore, will necessarily be smaller on SLG. If elasticity is used instead of the estimated coefficient, OBP is 1.8 times greater than SLG.

The argument is the relationship between each “point” of OBP is worth nearly three-times as much as a “point” of SLG. The elasticity, which I report, is irrelevant to this sidebar to the main discussion. I understand that SLG is greater than OBP for most players, but the debate is how much different is the ratio than 1.5–1.8.

And please, no lecture on econometrics here. What does collinearity affect? The standard errors. Because both coefficient estimates are statistically significant it is important to keep both in the model. And even if this was inappropriate, I am merely trying to replicate something done by someone else. There are cases where collinearity is so extreme that two variables should not be included in the same regression: this is not one of those cases.

Also, let’s view this in light of his critiques of my econometric methods elsewhere. When I exclude something, I am creating omitted variable bias. But, when I include something I have multicollinearity. It’s hard for me to win here.

On my measurement of pitching skill, Zimbalist isn’t a believer in DIPS:

Bradbury also discusses the assessment of pitching skills in this chapter. The main argument here is that a pitcher’s ERA from one year to the next is highly variable, but that a pitcher’s walks, strikes and home runs allowed are more stable over time. The inference is that ERA depends more on outside factors, such as a team’s fielding prowess, and, hence, is a poor measure of the inherent skills of a pitcher. While there is something compelling to this logic, it seems caution is in order. First, a pitcher’s skills may actually vary from year to year, along with his ERA, as other factors change, such as, his ballpark, his pitching coach, his bullpen, his team’s offense, the angle of his arm slot, his confidence level, etc. This variability does not mean that the skill is spurious.

I disagree. It most certainly does indicate a lack of skill, especially since the other metrics do not exhibit this same variability. If he believes this, I suggest that he write up a response to my paper in this month’s Journal of Sports Economics in which I go into the full details. On page 170, endnote 71 points to the citation of this paper on p. 321. Though the paper was not published until recently, I would have been happy to provide a copy if asked. I presented the paper at the Southern Economic Association Meeting a few years back and no one there mentioned this particular objection. Neither did an anonymous referee at JSE. I’m going to see more than this “does not mean the skill is spurious.”

Zimbalist continues:

Second, if all we consider is strikeouts, walks and home runs, what are we saying about sinkerball pitchers who induce groundballs or pitchers who throw fastballs with movement or offspeed pitches that induce weak swings and popups?

I am saying that pitchers have almost no effect on hits on balls in play, and that sinkerball and offspeed pitchers are good because of their strikeouts, walks, and home runs, not because of any effect they have on balls in play.

TBE, p. 167–170.

“Everyone knows that Greg Maddux is so good because his pitches produce easily fielded balls.” …[Insert lengthy rebuttal of this argument]…It turns out that the real reason Greg Maddux is so good is that, though he is not an overpowering strikeout pitcher, he rarely walks batters or gives up home runs.

That is why DIPS is so controversial. Of course, then I argue that pitcher do appear to have some effect on balls in play, but this impact is captured in those stats. DIPS has been widely debated in the sabermetrics community since the late-1990s. I make numerous references to this in the chapter, including a variant of the argument introduced by Bill James in 1987. Again, Zimbalist seems to have glossed over my explanation.

Zimbalist feels my marginal revenue product estimates are fatally flawed.

Next, Bradbury offers a chapter on the worth of a ballplayer. He gets off to a bad start here by misrepresenting the functioning of the players’ market and the terms of the collective bargaining agreement. He then misspecifies his team revenue function, leaving out RSN ownership, the number of large corporations in the host market, the size of the team’s assigned television territory, among other factors.

I’m not sure where I’ve erred in my understanding of the CBA. I laid it out there pretty simply, so maybe I sacrificed some precision for expediency in getting to the argument. But, since Zimbalist doesn’t say, I can’t really respond.

All revenue estimates come from the Forbes Business of Baseball Report. Are these estimates perfect? No. The best option would be to have detailed financial data provided by all 30 teams, but teams are a more than a little reluctant to provide this stuff. Do they tell us something about the earnings teams take in? That is an open question, to which I believe the answer is “yes.” I think, though I am not sure, that he is suggesting that I need some more control variables for RSN ownership, but this is just weird. If winning leads to more revenue as it comes through RSNs, the the coefficient estimates ought to reflect this impact. Are omitted-variable distortions possible? They always are, and I see no obvious reason that the absence of RSNs—especially, since most teams now have them—will bias the estimates.

In the end, this is a simple model, necessitated by the availability of the data. The test of any model is how well it predicts, relative to alternative models. Recently, Zimbalist told a local Atlanta writer that it was “utterly preposterous” for Scott Boras to expect Andruw Jones to get $20 million/year. Well, he got $18.1 million, even after tanking in 2007—Boras’s $20-million/year request was made before the 2007 season. I think I did pretty well with Forbes data and a few assumptions.

Zimbalist continues:

But the fatal problem is that Bradbury’s methodology unwittingly identifies a player’s average revenue product, not his marginal revenue product. By his reckoning, all of a team’s revenue is attributed to the players, leaving nothing left over for front offices expenses, stadium expenses, minor league operations, or profits. Given this misstep, it is not surprising that Bradbury finds players at all levels (under reserve, arbitration eligible and free agents) are paid less than what he estimates they are worth.

This is just incorrect. My estimates most certainly are marginal. Those multiple-regression coefficients are partial derivatives, so I’m not sure how to respond to the statement that these are not MRP estimates.

I clearly acknowledge that there are other inputs to winning—after all, I did write the Mazzone chapter. How should we solve the fact that OBP and SLG contain contributions by coaches and players? There is no simple answer, but it is one that I address in the text. Given that players earn far more than coaches, I don’t think it’s too much of a simplifying assumption to initially give all of the credit to the players, then extrapolate from the estimates. At the end of the chapter, I state that these gross MRP estimates do not account for resource costs, which include these other factors.

TBE, p. 197.

If teams are willing to pay player salaries equal to the value produced on the field minus other training costs, then our gross MRP estimates should be above actual player salaries.

In conclusion to this particular argument, I will put my estimates up against Zimbalist’s method in his book Baseball and Billions (1992) any day of the week. These are the ones where he takes Gerald Scully to task for using the strikeout-to-walk ratio to measure pitchers—I show that Scully is right and Zimbalist is wrong in Chapter 12. These estimates also measure hitter value using a measure known as “PROD”. PROD is the sum of OBP and SLG—yes, that is OPS—yet Thorn and Palmer (1984) are not credited. [Zimbalist disputes this last point, see this post below and the comments section.]

Now onto the monopoly section.

Zimbalist feels that I have mis-stated the history of the jurisprudence regarding the origin of the antitrust exemption. I do not have time to investigate this at the moment. Without going into all of the detail, I think it is pretty clear that any mistakes that I did make (I’m not saying he’s right, either) are not relevant to the main argument. There is an exemption that arises from legal precedents, and I think its effect is minimal.

Zimbalist continues:

Bradbury then distorts the record further by asserting (p. 205): “At the heart of the argument that MLB acts like a monopolist is the existence of the antitrust exemption.” He cites no sources for this claim, because there are none.

He wants a source for this? Watch any news report discussing the business aspects of baseball. And several sports economists strongly advocate removing the exemption, so it is clearly an issue.

Zimbalist continues:

Each team sport league is a monopolist because it is the sole producer of its product and has no close substitutes.

Chapters 15 and 16 of TBE are devoted to rebutting this claim. Chapter 15 is not discussed and I address his problems with Chapter 16 below.

More Zimbalst:

While the value of baseball’s exemption today is not what it used to be, there is still a good case to be made that MLB’s minor leagues and perhaps its amateur draft could not exist in their present form were it not for the exemption.

The NBA, NFL, and NHL all have amateur drafts, yet lack the antitrust exemption.

Zimbalist on contestable markets:

Bradbury’s last essay argues that the market for top-level professional baseball in the United States is contestable. If this were true, then the earlier question about whether or not MLB is a monopoly might be moot. Here Bradbury makes two points. First, if there is an aspect of the industry that is not a natural monopoly and, hence, constitutes an artificial barrier to entry, it is the subsidies from local governments that teams receive for the construction of their stadiums. But, he avers, this is not really an issue because (p. 220) “the public does not seem averse to subsidizing major sports teams from leagues other than the dominant existing league.” It is clear that Bradbury has never been involved in starting a new or non-dominant league.

He’s got me there, I have never been involved with starting up a new sports league. Maybe by the time I am 60 it will happen. I’m not sure why this is relevant except that maybe Zimbalist fondly remembers his own involvement in the United Baseball League in the mid-1990s. This was a league that tried to start up at the time MLB was half-way to expanding the league by four teams. I admit that it is difficult to start a new league when the old one is expanding: that is the gist of my argument. In this chapter, I argue that MLB must expand to meet the needs of fans or another league will rise up, and that after years of responding to entry the league now acts to prevent entry. This seems to prove my point. I guess I should thank Zimbalist for reminding me of this, I’ll be sure to include the example in the next edition.

Zimbalist continues:

His notion that politicians are not averse to providing subsidies to teams from these upstart leagues is just plain wrong.

Let’s look at the text surrounding the quote that Zimbalist offers, in which I am responding to the potential objection that citizens will be less willing to subsidize major league teams in a rival league.

From TBE, p. 219–220.

First, [the argument] does not apply to cities without current MLB teams. Teams in competing leagues may be just as successful at extracting public subsidies as MLB if they promise to bring major-league-level baseball to town. Plus, even if the costs of operating a team are higher in a city without an MLB team, the new team doesn’t have to worry about its fans migrating to a crosstown MLB rival. A slightly inferior product my still yield sufficient revenue for the owner to purchase major-league talent. This puts these teams in a rival league on competitive footing with MLB.

Second, the history of competing leagues does not reveal any public bias toward the public funding of stadiums of stadiums for new leagues. Many of the teams in the United States Football League (USFL), which competed with the NFL in the mid-1980s, played in publicly financed stadiums. In fact, many USFL teams shared stadiums with NFL teams. History shows that the public’s willingness to subsidize teams extends beyond the dominant league brand. The point is not that MLB teams could share stadiums with rival leagues—I think this would be highly unlikely—but that the public does not seem averse to subsidizing major sports teams from leagues other than the dominant existing league. It seems that as long as a new league promises to pursue top-level talent, as the USFL did in football, citizens will subsidize new teams. So public subsidization of stadiums doesn’t appear to be much of a barrier to entry in the baseball market.

I have highlighted the one sentence of two paragraphs in which I justified the quoted statement with theory and history. It is fine to disagree with me, but at least offer an explanation. Furthermore, Zimbalist also makes no mention that I offered any explanation. Previously, Zimbalist has picked nits, misunderstood my argument, or was too lazy to find my rebuttal; this is a deliberate misrepresentation of my argument.

Zimbalist also finds fault with my use of history as evidence of competitive pressure.

Second, Bradbury goes on to argue that MLB’s market is contestable. He does this by discussing the emergence of the American Association in 1882 and the American League in 1901. He further adduces what he erroneously calls the “Central League” (real name: the Continental League) forcing baseball to expand the number of its teams in 1961. Leaving details aside, the difficulty with Bradbury’s claim is that the industry’s economic structure today is very different from what it was 57 or 120 years ago.

In regard to the Central League gaffe, mea culpa. This is quite embarrassing, and it was one of the first mistakes I noticed after publication. I’m not sure how this happened, since I know the correct name, and I noted this error in the errata (link on the right sidebar) many months ago.

I hypothesize that baseball hasn’t faced any actual competition since the Continental League threat because it has chosen to expand before such threats arise. That is what constestable market theory says ought to happen. The mere threat that someone might enter is sufficient to force a single firm to behave. It is quite difficult to miss this point, especially given the title of the chapter, “Expansion and the Invisible Hand.”

It’s fine to disagree with me, but I did not ignore the difficulty using historical examples to shed light on the present. Once again, I addressed this argument in the text when Zimbalist insinuates that I did not.

TBE, p. 227.

Has the competitive pressure that fueled interleague baseball competition in the past evaporated, or does that competitive pressure lurk in the minds of owners, who fear the entry of a new outlaw league? The fear probably still lurks. We have plenty of rich men and women looking to be loved by baseball fans across the continent. I doubt that our current stock of eccentric wealthy egomaniacs could leave large quantities of money and public adoration alone. And I have a feeling that the current stock of owners who are members of this crowd are far more familiar with this than the average baseball fan realizes.

In conclusion, I have to say that I am disappointed in Andrew Zimbalist. His demeanor and thoroughness is out of step of what is normally expected in academic discourse. It is hard for me to learn anything from critiques that are largely based on misunderstanding or flat out ignorance of my arguments. The arrogant tone is unnecessary and inhibits constructive discussion of these issues.

One of my goals in writing this book was to push economic theory to extremes within the sports economics community. At the time I began writing, I felt we were settling for too many old truisms (e.g., MLB is a monopoly) that might not be completely correct. It is not that these claims are necessarily wrong, but I wanted to raise some possible objections. It was my hope that others might respond to my ideas with new insights that might confirm or reject my hypotheses. And in the end, I might feel more comfortable holding certain beliefs.

I would like to reiterate that I am fine with criticism, and I encourage it. As I wrote in the Epilogue,

Applying my professional training to the game that I love has taught me new, unexpected lessons. Notions that I held about the game turned out to be false. I thought Leo Mazzone was overrated as a pitching coach and that batters protected one another in the lineup. I’m happy to have eliminated some of my ignorance. …

Unsatisfying answers provide opportunities to expand knowledge. I hope that if you find any of my conclusions to be unsatisfying, this will motivate you to search for better ones.

It is too bad that Andrew Zimbalist did not heed my advice.

Update: Zimbalist offers a response, of sorts. On the whole it is more of a general overview of his opinion of the book than a response. I do want to acknowledge that Zimbalist asserts that he did cite Thorn and Palmer (1984). I no longer have a copy of his book, so I cannot verify this. My assertion that he did not was based on a recollection of mine. If I am incorrect, I will retract my statement.