A quick recap: in my previous two posts, I’ve done some digging into the recent history of the MLB free agent market, investigating how teams have priced an additional win this year and in years past. Comparing my work with similar research done by David Cameron of FanGraphs, I thought it possible that teams had reached an equilibrium in the way they valued free agents; the rate at which teams paid for an additional WAR found by Cameron for 2008 was essentially the same as what I found for 2012.
To check my findings, I repeated the analysis I did for the 2012 market for 2009-11. Below, I’ve shown both my results (in red) and the figures Cameron arrived at for 2002-08 (in blue).
The proper reaction to the drop-off between the end of Cameron’s analysis and the beginning of mine is the raise of a skeptical eyebrow; even the financial crisis of 2008 wasn’t enough to precipitate that sort of change. If the climate of the MLB free agent market had shifted that dramatically over the course of one year, we wouldn’t need a blog post four years after the fact to notice it.
I thought I had replicated Cameron’s methods fairly well, but our respective results suggest otherwise. The only way I can think of in which Cameron’s work differs from mine is that he says he uses a weighted average of a player’s past three seasons of WAR, instead of just a straight mean, though he doesn’t say exactly what those weights are. With that information, I might have been able to hit the target a little more closely.
Still, my work does corroborate one of Cameron’s findings: from year to year, the market rate paid to free agents is rising, perhaps even faster than it has in the past. From 2009-12, I found an annual average increase of 22 percent in dollars paid per WAR, over twice what Cameron derived for 2002-08. It would appear, then, that the existence of the equilibrium I suggested last week was nothing more than a mirage. Though Cameron and I started from different places methodologically, we both found that, for free agents, the rich have indeed been getting richer.
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He has also authored or made contributions to many books, including the Sports Illustrateds 100 Fenway: A Fascinating First Century.
Now living in Marblehead, hes focusing his attention on the Boston sports scene, specifically delving into the numbers affecting the Red Sox, Patriots, Celtics and Bruins, with the goal of informing and entertaining real fans. You can follow him on Twitter at @SabinoSports.