Major league baseball’s Moneyball at age 15: a re-appraisal

ABSTRACT

In the 15 years since publication of the book Moneyball: The Art of Winning an Unfair Game in 2003, major-league baseball (MLB) has seen the embrace of analytics by both fans and teams. Using 45 seasons of MLB data, since the introduction of the designated-hitter in the American League in 1973, the present study validates the central premise in Moneyball regarding the importance of certain performance metrics, such as on-base percentage (OBP). The terms in our empirical model are constructed such that our results permit a straightforward comparison of the relative contribution of each factor towards MLB teams’ success in winning games. We also provide evidence indicating that MLB teams have moved to align their payrolls with Moneyball analytics in the years following the book’s publication.

KEYWORDS:

• Major league baseball
• sports analytics
• efficiencies in sports labour markets

JEL CLASSIFICATION:

• L83
• D21
• M20
• M21

Disclosure statement

No potential conflict of interest was reported by the authors.

Notes

¹ In 2011, the book was made into a movie starring Brad Pitt as Beane. The movie took in $110 million at the box office.

² Bill James’s analytics contributions to the game of baseball were parodied in a 2010 episode of ‘The Simpsons’ featuring a cartoon-character Bill James saying, ‘I’ve made baseball as much fun as doing your taxes!’.

³ Slugging percentage (SLG) is defined as total bases divided by at-bats, with total bases equal to four times the number of home runs, plus three times the number of triples, plus two times the number of doubles, plus the number of singles.

⁴ A review of the economics literature shows also reveals the application of similar Moneyball-type analytics to other sports (Paul and Weinbach 2011), such as professional soccer and horse-racing. The presence of market inefficiencies in these other sports is usually confirmed (Rockerbie 2017).

⁵ The National League has refrained from adding the designated hitter.

⁶ https://www.baseball-reference.com/leagues/MLB/2017.shtml for the 2017 MLB season, and so forth.

⁷ Following MLB convention, WLP is expressed as a decimal.

⁸ For example, a team with 165 home runs against that season’s league average of 150 would be assigned a normalized value of 165 divided by 150, or 1.10, for home runs that season.

⁹ The difference between at-bats and plate appearances is that plate appearances include at-bats as well as walks, sacrifice flies, sacrifice bunts and hit-by-pitches.

¹⁰ A closely related pitching metric to OBP is walks plus hits per innings pitched (WHIP).

¹¹ As noted earlier, defensive (pitching) strikeouts are not included because it was unnecessary and econometrically unsound to include strikeouts as both an offensive and defensive term.

¹² Two other fielding-independent pitching metrics favoured by the new analytics are home runs allowed and walks allowed. Home runs and walks are included in our model.

¹³ https://www.usatoday.com/sports/mlb/salaries/2017/team/all/for the 2017 MLB season, and so forth.

¹⁴ Moneyball was first published (hardcover) in June of 2003, partway through that year’s MLB season.

¹⁵ Downloaded from the Federal Reserve Bank of St. Louis FRED website: https://fred.stlouisfed.org/series/USAGDPDEFAISMEI.

¹⁶ One such exception was the 2004 MLB season where home-run record-holder (and accused steroid user) Barry Bonds of the San Francisco Giants drew 232 walks against 135 hits.