Monday, November 5, 2007

Hot Stove League

As I sit in a coffee shop next to a fire place my mind turns to hot stove league baseball. One favorite topic of the hot stove league is how best to insure that teams like Kansas City, Oakland, and Minnesota can compete with New York, Boston, and Chicago. Currently those teams with larger revenues make payments to teams with smaller revenues to insure a more even playing field. However, those teams do not always spend those extra payments on getting more players. A recent NY Times column suggests that those payments should be tied to attendance, specifically the percentage of seats sold by a given club. A few problems arise with this suggestion, not all stadiums are the same size. For example the Pittsburg Pirates’ PNC park sits 38,000 compared to 50,000 at the Colorado Rockies Coors field. In other words the Rockies could be at 80% capacity and sell more tickets than a 100% Pittsburg.
Instead of linking the payments to percent of capacity filled, perhaps linking them to attendance. One way would be to predict what expected attendance should be in a given city compared to similar cities. Although, I’m not sure that is the answer either. Teams might want to give experience to rookies, who in the short term might not play as well as experienced players, but might lead to better outcomes in a few years. Baseball Prospectus has done some great work modeling, when teams might want to make these tradeoffs.

Finally, on the day after two juggernaut NFL teams face each other (the Colts and Patriots being the Yankees and Red Soxs of the NFL even under the salary cap), we might wonder if imbalance is such a bad thing. One recent paper has suggested that lack of balance does not impact attendance.

Although I’m not opposed to anything that hurts the Yankees.

hat tip to Sports Guy Talking Crazy for the Article

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