From SABR member Lewie Pollis at Deadspin.com on June 11, 2014:
Baseball is a strange market, forever correcting itself in strange ways. For a long time, the most obviously central ability for a hitter—getting on base—was overlooked, until suddenly it wasn’t, and it occurred to teams that there were probably all sorts of other valuable skills they were neglecting. In the years since Michael Lewis wrote about how Billy Beane’s Oakland A’s got an edge in an unfair game, all sorts of inefficiencies in the market have been noted and accounted for. The most glaring, though, is still right there, waiting to be taken advantage of. It doesn’t have to do with who the players are, but rather with who picks them.
Most observers take it as given that the market for MLB front office employees—general managers, scouting directors, analysts, and so on—reflects a rational equilibrium for an industry in which aspiring workers vastly outnumber available jobs. In my senior thesis, “If You Build It: Rethinking the Market for Major League Baseball Front Office Personnel,“ I challenge this assumption and offer literally game-changing estimates for the potential values of the people who put the teams together.
The short version is that the value of an elite general manager to his or her team is on par with (if not higher than) that of an MVP-caliber player. Despite this, white-collar team employees make significantly less than top players. That means that a dollar spent on front office talent will go much further than a dollar spent on a free agent—and that the market for non-player employees as it is currently conceived is irrational.
In recognition of the fact that my full paper is longer and more detailed than most people would care to read, here’s an abridged summary of what I did, what I found, and what it means.
Read the full article here: http://regressing.deadspin.com/why-a-great-general-manager-might-be-worth-more-than-mi-1589122571
Originally published: June 17, 2014. Last Updated: June 17, 2014.