Is there any correlation between winning and team payroll in MLB?

Question

The five teams with the highest team payroll are the Yankees, Tigers, Mets, Red Sox, and White Sox. The five teams with the lowest team payroll are the Marlins, Rays, Athletics, Pirates, and Nationals. As of this day the five highest teams have a combined won/lost record of 100 wins and 105 lost while the five teams with the lowest payroll have a combined team record of 108 wins and 98 lost. What exactly, if anything, do these numbers tell us? In a prior post a few days ago Craig S. had a similar question, do these numbers indicate that there are more important issues in fielding a winning team than just acquiring high priced players? Is the ability of a team to buy a championship just a myth?

Answer 1

If there was no difference between the success factors or chance factors, then those 5 highest spending teams would be closer to the norm, so there is at least a perceived advantage to spending all that money.



The Rays and the Athletics draft very well, the Athletics can turn regular guys into above average pitchers.



The bigger teams in question often have to send draft picks for signing free agents.



Let's face it, the Tigers are underachieving, the Mets are as well. The Yankees have horrible starting pitching.

They didn't address it, they could have, but they wanted to resign Rodriguez, a guy they really didn't need.



It's true that you can't buy a championship, but you can buy those lottery balls that increase your odds greatly.



If high salaries really didn't buy you any advantage, they wouldn't be around.

Answer 2

Well, higher payrolls do have an advantage and I do believe that there is a correlation in some ways.



1. The Yankees and the higher payroll teams have the option of picking up the veteran players because they usually cost more than a rookie will (in this case, A-Rod would be considered a veteran). Obviously, those players have had more experience and thus far, will probably do better in the second half of the season, during the dog days of summer.



2. The higher payroll teams have the option of maintaining the team for a longer period of time. Look at the Marlins of 2003 and the Marlins of 2006. Those records are completely different! And then look at the Red Sox of 2004 and the Red Sox of 2007. They were both World Champions. So as the Marlins players were moved through the farm system and eventually made the majors, they won in 2003, but the players demanded more money, so eventually, they left (i.e. Beckett) to a higher payroll team and the Marlins were lef tin the dust because they didn't have as much money. The Red Sox were able to keep a good team, because they have more money to put on the table.



3. You're really going to need a great scouter to lead a low payroll team to greatness. They have to pick out the guys that have the true talent to produce in the bigs.



In conclusion, I am not saying that a low payroll team can't thrive. I am saying that it just makes everything harder to win, etc. So I do not believe in "buying" a World Championship, but I do believe it can make it easier to win. It doesn't look like the Yankees scouts picked the best pitchers!



And the White Sox sign too many players for way more than they are worth. A relief pitcher for 5 million a year???? Come on!

Answer 3

Money buys talent, not wins. The Yankees and other such teams are fortunate enough to have gobs of talent on their rosters at all times. However, a stable team must be built with some sort of foundation in place in order to maintain their winning ways. That's why the Red Sox stayed competitive over the years; they made shrewd trades, signed the right free agents, and compiled an impressive core of young pitching. Their payroll also allowed them to get Dice-K, Manny Ramirez, Curt Schilling, and J.D. Drew. As much as I dislike Boston, they're managing their team the right way.



Then you have a team like my beloved Cardinals. I still refuse to acknowledge their 2006 World Series win as a fluke because, well, it wasn't! 2006 was merely the last hurrah for an old core of players who were ready to break down (see: Edmonds, Rolen, Eckstein, Weaver, etc.). Now they are paying for years of farm system neglect.



You must have both a top 10 payroll and a self-renewing talent base in order to stay competitive in this league. Either/or will keep you around, but not very long.

Answer 4

I think what it shows is that an "All-Star" lineup doesn't necessarily make up a "Team". There has to be chemistry among players in order to be successful. Ultimately the goal is to win a world series and since the Red Sox have one of the highest payrolls in baseball I would have to say there IS a correlation.



At the moment the numbers that you have compiled only represent approximately 40 games into a 162 game schedule. Let's see how this plays out. One thing money can't buy and that's heart! The team with the biggest heart usually wins championships.

Answer 5

Check out this page, tracking the 2008 season day by day (skipping the first week, when the dataset was so small as to be pointless).



http://benfry.com/salaryper/



Blue lines == good!



Red lines == bad! (Well, expensive with inadequate return.)



The 2005-06 (the 2007 link works but there's no graph) seasons are linked near the bottom. These are active graphs and may take a few seconds to load. While the colors and line weights are informative, the SLOPE of a given line is the most telling feature, I think. Steep means the advantage (doing well or flushing money) is significant.



2005 bluest == Indians

2005 reddest == Mariners



2006 bluest == Twins, Athletics

2006 reddest == White Sox



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Remember that these are just relative rankings -- payrolls are listed highest to lowest, with no regard to actual dollars. Same with W-L records, although that necessarily operates over a much smaller, fixed range. Interesting to ponder anyway.

Answer 6

There is a major difference between what the Marlins are doing and what other teams have done. The Marlins have received 24 mill. in revenue sharing each of the past 2 years and were forced to add salary last year to get to 37 mill.....a massive salary increase from the 22 mill. in 2008. Simple math suggests they received 48 mill. in revenue sharing and spent only 59 mill. in salary so they took in their own gate and also get the tv contract money and merchandise money yet only parted with 11 mill. of their own profits. In contrast you mention the Royals who had a payroll of 70.6 mill. last year alone which is 11 mill. more than the Marlins spent in 2 years. They spent 58.3 mill. in 2008 so they paid in 2008 what the Marlins paid in the past 2 years. Even Tampa Bay has spent 107 mill. over the past 2 years with the same revenue issues the Marlins have. No other team has come close to the low payroll of the Marlins who pocketed 3 million in revenue sharing (which was instituted to allow lower gate teams to have reasonable salaries) plus the entire amount of their own receipts which means while other teams spend the money the fans give to build a respectable product (or at least attempt to) the Marlins ownership was pocketing 50-60 million in profits. Their fans deserve better and with their penchant for finding and producing young talent there is no good reason to not build a contender instead of trading away every guy as soon as they are eligible to be paid on par with other players (like the fact they actively sought offers for Uggla since he is due a big raise). MLB shouldnt get involved except in extreme cases....this was an extreme case and it has been reported they will be monitoring the Padres too (they know the finances in Pittsburgh and are satisfied they are spending pretty much all they take in so far or they will be the next team put on notice). The Royals are spending money...the Rays are spending and so are all the other teams.

Answer 7

I personally don't think that there's a correlation between the amount on a team's payroll and the number of wins they have. Look at the Yankees, they have the highest payroll of any team in baseball and haven't won a WS in 8 years. Therefore, that is proof that a team buying a championship in baseball is a myth.

Answer 8

It is 100% not true that you can buy a championship year in baseball(basketball is a little differant). Who is in First in the two easts? Tampa and Marlins. Last year the Indians got up 3-1 in the ALCS without a large payroll. Myth busted.

Answer 9

I think generally speaking, a higher payroll correlates to a higher level of performance, but like anything with humans, it doesn't always work out. For example:



1. you can spend the money badly (e.g. Carl Pavano)

2. you can sign guys to long term contracts who run out of gas or get injured, so you're still paying while they're not performing (e.g. Pedro)

3. you can blow all your dough on position players and have no starting rotation or bullpen, or just spend badly on pitching

4. You can sign dogs who only play hard in their contract year

5. you can mismanage the babied superstars

6. you can pay for guys who perform well during the regular season but choke under playoff pressure



so I don't think you can buy a championship, but you certainly can create a situation where you're a contender for the playoffs year in and year out.



By the way, if the season were a marathon, we are now at about mile 7 of 26, so let's not jump to conclusions on current W-L records.

Answer 10

I wouldn't say that a big payroll necessarily guarantees anything, but there is absolutely a positive correlation between winning and payroll. The Yankees have been to 13 straight postseasons and it isn't because they have the best farm system in the bigs. Payroll isn't everything, but it sure helps.

Answer 11

Typically, the correlation is that more money equals more wins... however... these days teams are becoming more adept at locking up young talent at affordable prices... and with steroids a bit more out of baseball, older players seem to be declining as normal again.



That's really hurting the high-payroll teams.

Answer 12

If you have no pitching then you have no chance. The Yankees are a prime example of this as their starting rotation has issues. Chamberlain and Rivera are great relievers but they can't do you much good if you are behind.



Another intangible is batting slumps. Players have them (see A-Rod) and when a team isn't hitting they are not likely to score much.



10 years ago they were untouchable. Their payroll is higher today than it was back then.

Answer 13

There is a correlation, but it's not 1:1. In general, teams that spend more tend to be better, while teams that spend less tend to be worse. However, other factors - notably, having a G.M. who doesn't make stupid decisions and having a good player development system - are almost, if not just as, important.

Answer 14

Executive Boxes and Hot Dogs,Beer and Nachos sold is what makes or breaks a players salary.

Averages do not sell tickets, results do. Is a game AND a show.