Monday, October 29, 2012

2012 MLB Dollars Per Win

With the San Francisco Giants' sweep of the Detroit Tigers last night, the 2012 MLB Season is officially in the books.

As I've done the past few years, I broke things down in simple terms: which teams were the most efficient in getting the most value per dollar in payroll? Yes, this isn't really a straightforward answer, since teams with higher payrolls tend to have higher non-baseball revenues (namely merchandising and TV deals), but from a pure baseball standpoint: who had the best year?

Below is a simple table of how teams ended up in terms of dollars in payroll vs. total wins (including post-season). The Oakland Athletics, a perennially efficient team, did extremely well this year, spending nearly one fifth as much per win as the lowly Red Sox. Not to be forgotten was the sub-par performance of the Phillies this season.

Source for payroll amounts:

The World Series Champion San Francisco Giants ended up in the middle of the pack due to their above average payroll, though one could argue winning it all is worth it. I would also credit the Washington Nationals for being the only other 100 win team while having a below average payroll; great year for the Natinals.

Just for your edification, here is the correlation between wins and payroll this year. Note how low R^2 is: 0.053. I'd have to look at other years, but this year turned out to be quite a year of parity.

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