Ettinger: Dissecting parity in baseball

As the Fall Classic begins to unwind, the weather is turning rather fair. True to form, as the bandwagon comes rolling into the station, so does an onslaught of cliché sports arguments. Indeed, it seems like the only thing more common this time of year than Tim Lincecum t-shirt jerseys is a really dumb baseball opinion. As a Yankees fan, the overwhelming majority that I hear go something like this: “Baseball isn’t fair. Teams like the Yankees spend too much money and win the World Series year after year, while teams like the Pirates are handcuffed by their budgets and are perpetual cellar-dwellers.”

There’s a fair amount of truth to this argument. Baseball isn’t fair. The Yankees are allowed to spend far too much and the Pirates far too little. In no way am I arguing that the payroll finances of baseball are sensible. Still, I think it’s worth shedding some light on the actual state of parity in baseball. As usual, to defog the ire of baseball’s fair-weather populists, we need to turn to the numbers.

Surface-level observation tells us that no one team has dominated playoff success over the past five years. In the past five World Series’, nine different teams (out of a possible ten) have participated — a pretty remarkable total. It’s slightly better than the eight teams that have made the Super Bowl and the seven that have made the NBA Finals. Broadening our gaze, we see that in the past five years, 22 of the 30 MLB teams have made the postseason. Indeed, on the surface, things look pretty good. But if we want to gain any real insight we have to dig a little deeper. What is the true source of this apparent parity?

We’ll start with the regular season. The 162-game marathon is truly the “long haul,” so it’s safe to assume that teams with better records are actually better teams. This lets us ask a fundamental question — how much turnover is there in which teams are good? How much hope does a bad team this season have of being good next season? How easily does a dominating team retain its edge?

If we rank all 30 teams by wins each season, the average team experiences a 6.93-spot movement in the rankings each year (using data from 20082010). This movement can be up or down, but the magnitude of the movement — nearly 7 spots — is key. In the NFL, for comparison, the average team over the same period experienced slightly higher movement — 8.22 spots. In the NBA, the average team experienced a much smaller shift — only 5.27 spots. Thus, if we rank the three leagues by the degree to which teams move up and down the standings between years, the NFL boasts a slight edge over MLB, while the NBA comes in a distant third. This statistic — standings turnover — is essential to the idea of “parity.” In any league with relative parity, bad teams have hope of improvement while good teams face the threat of decline.

As always, we can break it down further. How much turnover comes from good teams relative to bad teams? In baseball, the average team sitting in the bottom third of the standings experiences only a 5.33-rank movement. The average team in the top third comes in at 6.98, while the middle third sees a 7.9-rank average shift. Thus, there is something to the claim that the teams at the bottom of the pile in the MLB tend to be stuck at the bottom, although we still see a fair amount of turnover at the top.

What of the everpopular claim that money is the ultimate weapon in baseball? To what extent do payroll discrepancies explain the regularseason standings? The key question is: how many extra wins does a dollar of payroll spending provide? Specifically, I calculated how many wins an extra $10 million bought. This is a considerable sum of money in a league in which most teams’ payrolls land somewhere between $60 million and $120 million. The results are surprising. An extra $10 million only bought a team 1.2 extra wins from 20082010! That is, a team on the very high end of the spending spectrum could only buy about seven wins over a team on the very low end. Indeed, discrepancies in spending explain only 14% of variation in wins in baseball. Money only counts for 14% — the other 86% is other stuff, including the kickbacks (revenue sharing, draft pick compensation) a team gets for spending less money. And for every team like the Yankees, there are teams like the Mets and Cubs whose spending is so inefficient as to offer no advantage.

The next step is to look at the postseason — certainly a crucial element in determining success. In a word, postseason baseball is as much of a crap shoot as most informed baseball fans hold it to be. In baseball, better teams (defined as teams that finish the regular season with a better record) perform almost no better than “bad” teams (teams with worse regular season records). If we rank baseball’s playoff teams from one to eight according to regularseason record, boasting a onespot improvement in the rankings only made a team 3.9% more likely to advance an extra round in the postseason (using data from 20062010). In the NFL, this number was 6.5%. In the NBA, a onespot rankings boost made a team 16% more likely to make it through one more series. Even more telling, in all postseason baseball series from 2006-2010, the team with the better regular-season record only won the series 51% of the time! In the NFL, they won 58% of the time, while in the NBA, they won 74% of the time. Thus, it appears that having a better regularseason record (a pretty good proxy for overall team quality) gave clubs almost no advantage in the postseason. The NFL showed a similar but less extreme pattern, while the NBA postseason appears to be dominated by the teams with top seeds.

To all the fair-weather fans with their cliché complaints, the true story of parity in baseball goes something like this: Parity in the MLB regular season is decent — neither great nor terrible. Teams at the bottom in particular, struggle to turn their clubs around from year to year. Compared to the NBA, however, the standings turnover is significant. Of note, spending more money doesn’t guarantee a team much success, explaining only 14% of win variation. The playoffs, however, are the true equalizer — any team that manages to make the postseason has a pretty good shot at winning it all, as better teams aren’t generally rewarded with deeper playoff runs. This, in particular, serves to explain the nine teams that have made it to the last ten World Series.

John Ettinger is a junior in Saybrook College.


  • WilliRechler

    Dear Ettinger,

    I agree.