MLB Pay and Performance 1988 to 2014

With the MLB regular season in the books and the playoffs underway, I thought that I would get back to looking at MLB pay and performance.  As we state in our book, The Wages of Wins, while there is a positive and statistically significant relationship between relative payroll and team performance (as measured by winning percent); the variation that is common between the two variables is not a lot.  So what I will do here is measure both the relationship and the amount of common variation (using r-squared) for the MLB regular season over a few different time periods.

If you are interested in performing your own payroll and performance analysis, here is a step-by-step guide to analyzing payroll and performance.

First, the two variables are MLB regular season winning percent, which I grabbed from ESPN and MLB team payrolls which I got from USA Today's MLB team payroll page. 

Second, as I have explained previously, I am using relative payroll because average payrolls have been increasing over time and average winning percent is constant over time.  Hence if I use total payroll instead of relative payroll, I will find a weaker relationship since MLB total payrolls are increasing and MLB winning percent is constant.  If I use relative payroll (a team's total payroll divided by that seasons average payroll) then I will be comparing two variables that are stationary to each other and get better results.

How much in common is the variation in relative payroll and the variation in winning percent by season?

1995-2014:  18.1%
2000-2014:  14.8%
2005-2014:  13.7%
2010-2014:    8.4%
2014:  relative payroll is statistically insignificant.

Over different time periods we see that the explanatory power of relative payroll on team winning percent has been declining since 1995.

2014 NCAA FBS Top 25 for Week 6

This past weekend has had more movement than an bowl of jello in an earthquake.  We have seen teams at the top (including the model's top team) lose.  Again this ranking is based on the Complex Invasion College Football Production Model Top 25 ranking using data from cfbstats.com.

After all the changes the model has the following four teams in the college football playoff:  1.  Baylor; 2. Michigan State; 3. Marshall; and 4. Auburn.

Surprises:
1.  Florida State is no where to be found in the top 25 and some teams
2.  Marshall is a playoff team and Georgia Southern is in the top 10.
3.  Mississippi State is ranked below Texas A&M, and
4.  The B1G has six teams in the top 25.

Rank	Team
1	Baylor
2	Michigan State
3	Marshall
4	Auburn
5	Louisville
6	Mississippi
7	Georgia
8	Georgia Southern
9	East Carolina
10	Nebraska
11	TCU
12	Texas A&M
13	Oklahoma
14	Mississippi State
15	Alabama
16	Duke
17	Oregon
18	LSU
19	Clemson
20	Missouri
21	Wisconsin
22	Notre Dame
23	Minnesota
24	Ohio State
25	Penn State

Previous 2014 NCAA FBS Top 25 Rankings
2014 NCAA FBS Top 25 for Week 5
2014 NCAA FBS Top 25 for Week 4
2014 NCAA FBS Top 25 for Week 3
2014 NCAA FBS Top 25 for Week 2 

Kansas Jayhawks under Charlie Weis

ESPN reports that the Kansas Jayhawk's have fired head football coach Charlie Weis who was in the third year of a five year contract.  Here is my analysis of the Kansas Jayhawk's under former head football coach Weis' tenure using the Complex Invasion College Football Production Model.

In the chart below, I have graphed the Complex Invasion College Football Production Rankings since 2008 by the team's total rank, offensive rank, defensive rank and worst team in the "league".  The first two seasons (2008 & 2009) were under Mark Mangino, the next two seasons (2010 & 2011) were under Turner Gill, and the last three seasons were under Charlie Weis.  As you can tell from the production rankings, Kansas has been a very poor performing football program for a number of seasons.

 

2014* Through the fifth week of the 2014 season.

I am only going to focus on Kansas under Charlie Weis for this blog.  I hope to come back and go back to the 2008 season at a later time.

2012
In his first season at the helm of the Kansas Jayhawks football program the Jayhawks finished at 1-11 and were bowl ineligible.  This season the Jayhawks again played against a "tougher" strength of schedule (SOS) as compared to the "league" average, meaning that their SOS was between one and two standard deviations below the "league" average SOS.  The Jayhawk's only victory was over FCS South Dakota State and their worst game was a loss to #72 ranked Iowa State.  Overall, the Jayhawks had the #117 ranked team with the #106 ranked offense and the #118 ranked defense out of 124 FBS teams.

2013
Kansas finished the regular season at 3-9 and were again bowl ineligible.  Kansas again played against an "average" strength of schedule (SOS) as compared to the "league" average, meaning they were plus or minus one standard deviation from the league average SOS.  Kansas's best game was their victory over #88 ranked Louisiana Tech and their worst loss was to #109 ranked Iowa State.  Overall, the Jayhawk's had the #114 ranked team with the #122 ranked offense and the #79 ranked defense.

2014
In what ended up as only four games coached by Charlie Weis, the Jayhawks were 2-2.  As of the end of the fifth week, Kansas has the #112 (out of 128) ranked team overall with the #123 offense and the #86 defense.


2014 NCAA FBS Head Coaching Changes (to date):
June Jones at SMU

2014 NCAA FBS Top 25 Ranking for Week 5

Week number 5 is in the books and we have a new #1 team using the Complex Invasion College Football Production Model Top 25 ranking using data from cfbstats.com in the Texas A&M Aggies.  The Aggies are followed by Baylor, Michigan State and LSU as the top 4 teams in overall production.  Marshall who was #1 last week has dropped to #6 in terms of overall team production.  Expect teams to move up and down each week.

Rank	Team
1	Texas A&M
2	Baylor
3	Michigan State
4	LSU
5	Nebraska
6	Marshall
7	East Carolina
8	Mississippi
9	Auburn
10	Oklahoma
11	Oregon
12	TCU
13	Alabama
14	Georgia Southern
15	Louisville
16	Wisconsin
17	Houston
18	UCLA
19	Duke
20	Maryland
21	Mississippi State
22	Memphis
23	Georgia
24	Cincinnati
25	UAB

Previous 2014 NCAA FBS Top 25 Rankings
2014 NCAA FBS Top 25 for Week 4
2014 NCAA FBS Top 25 for Week 3
2014 NCAA FBS Top 25 for Week 2

Competitive Balance in MLB

With the end of the Major League Baseball season, I have calculated the Noll-Scully measure of competitive balance and find that MLB was 1.509 for the 2014 season.  Below is a chart of the Noll-Scully measure of competitive balance since 1982.  For the entire time period the average Noll-Scully measure of competitive balance is 1.700.   So for this time period, the 2014 MLB season was more competitive than the average since 1982.

If you are interested in doing this on your own, here is a step-by-step guide to calculate the Noll-Scully measure of competitive balance using Microsoft Excel.

Ticket Revenue Analysis

Today in my Sports Economics course I am presenting our paper "Stars at the Gate" published in the Journal of Sports Economics about the drivers of NBA gate revenues.  Given its timeliness, I noticed the following article on generating data insights in ticket revenues.

2014 NCAA FBS Top 25 Ranking for Week 4

Well a quarter of the regular season is now in the books.  I have again estimated the Complex Invasion College Football Production Model Top 25 ranking using data from cfbstats.com.  This week we have a new #1 team - the Marshall Thundering Herd.  Baylor has dropped to #5 (the bubble team in the new college football playoff format).  Thus the four most productive teams using my model are:  Marshall, Alabama, Duke and Mississippi.

Notice that seven of the top 10 teams are in the SEC!

Will this change?  Yes - probably, as the season progresses and as the teams production relative to the rest of the league changes.   Here is this week's top 25.

Rank	Team
1	Marshall
2	Alabama
3	Duke
4	Mississippi
5	Baylor
6	Texas A&M
7	Georgia
8	LSU
9	Mississippi State
10	Auburn
11	Pittsburgh
12	Louisville
13	North Carolina State
14	Stanford
15	Arkansas
16	TCU
17	Michigan State
18	Missouri
19	Cincinnati
20	Nebraska
21	Oklahoma
22	Oregon
23	UAB
24	Wisconsin
25	East Carolina

Previous 2014 NCAA FBS Top 25 Rankings
2014 NCAA FBS Top 25 for Week 3
2014 NCAA FBS Top 25 for Week 2