Economics General Baseball



We hear this word thrown out a lot.  Team X "overpaid" for Player Y.  Team A is going to have to "overpay" if they want to secure the services of Player B.  

We're curious to know what the term means in different situations, since markets for players evolve and fluctuate, and are sometimes radically different from day to day.  One might say that the Sox "overpaid" a posting fee.  And they also might say they "overpaid" an aging third baseman.  But these are two very different situations, and the meaning of that term can be quite ambiguous, arguable.

Discuss in the comments.

10 replies on “Definitions”

To continue with the theme on Beltre from the previous thread (in terms of the “Overpay” use):
I think the Sox’ need to replace both the bat and the defense of Lowell will necessitate them paying more than what the market might ask for in Beltre’s case. In one sense, there is no such thing as overpaying in this type of case because the “need” for one team to not lose out on a certain type of player, given their market and competition within that market. The Sox also are aware that there really isn’t much in the way of big free agent 3rd baseman on the horizon (2011 sees Scott Rolen available and a 33 year old Aramis Ramirez–and Aramis has a 14.5 mil option he may or may not exercise or just be extended by the Cubs).
They also cannot wait around for 1st base free agents (with the hopes of moving Youklis over to play 3rd) because the next that’s coming in 2011 is Pujols who the Cards are clearly saving up for. After that it’s an aging Berkman and Derek Lee.

I think we can all see why Theo decided to give Teixeira a humongous amount of money, much more money than he’s ever even thought about giving another free agent. There’s simply nothing out there in terms of corner FAs.
He must be insanely pissed off that John Henry went and screwed it all up.

Andrew, can you please keep the discussion to the topic at hand, or at least tailor your criticisms of the Sox’ ownership so that it addresses the question of the thread?

I think that one of the issues for the Sox in terms of Texeira, specifically in terms of potentially “over-paying” against the Yankees was that they did not foresee David Ortiz’ troubles with the bat lsat year (neither did most people I know for that matter). Lowell ended up putting together some very good numbers, and if Ortiz had been pacing better, the Red Sox would have easily won more games earlier in the year.
So, in their estimation, they would have been over-paying for production they didn’t need. Now, there was also talk last off-season that they tried to move Lowell; and maybe if they had been able to do that they would have gladly over-paid for Tex and moved Youklis to third.

Oh, I was just replying to walein’s comment on there being no real corner options on the market in the near future. But, okay:
The Sox should have ‘overpaid’ for Teixeira. Overpaying for bonafide stars is (almost) never what hurts teams (obvious exception for Tom Hicks). It’s overpaying for mediocrity, and unfortunately, you see it all over baseball. Look at the mess the Tigers are in. They vastly overpaid for Willis, Bonderman, Robertson and Ordonez, varying degrees of solid players all when they were signed, but none of them in that upper echelon. It’s so bad, they had to trade away cheaper, much better players in Jackson and Granderson simply because they were actually still good players and could be moved.
Look at the Mets. They shelled out very big bucks to Carlos Beltran and Johan Santana. You could say they overpaid them. But no one ever mentions them when talking about the Mets not being able to afford other good free agents. No, it’s the signings of mediocrity like Oliver Perez or Luis Castillo, or simply utter crap like Alex Cora (simply giving him a major league contract qualifies as an overpay), that piles up and screws them in the end. Look what the Royals paid for Kyle Farnsworth, and Mike Jacobs.
The Yankees and Red Sox overpay mediocrity as well, although they don’t really seem to be affected by it payroll-wise. Carl Pavano and Jaret Wright come immediately to mind for the Yankees. Julio Lugo, Mike Lowell come to mind with the Red Sox. The Sox’s problem now is that they refused to shell out the big bucks when they had all the payroll space in the world to do so. My biggest fear was them signing Mark Teixeira to however many dollars per year, because their payroll was so flexible that they could very, very easily afford him and have space for several other premium free agents. It looked like Theo’s plan of extreme payroll flexibility would pay off as they could be like the Yankees and not even feel Teixeira’s monster contract. Instead, they passed, or screwed up negotiations, or what have you, on one of the most obvious free agents in a very long time and are stuck with needing to overpay mediocrity like Adrian Beltre.
I guess what I’m saying is that when there are obvious free agents out there, that is the time to shed the ‘value’ mindset and simply go for it, or you’ll end up backed into a corner and being forced to spend on vastly inferior players.
I think Holliday qualifies as an obvious buy. He has very good power, great plate discipline, and is an above-average defender, has good speed, and is 30 years old. The Sox also have a need for a left fielder. This is again one of those obvious free agents that probably won’t come around again for a while. If the Sox are willing to spend $15 million a year on Jason Bay through his age-34 season, they should be willing to spend $3 million more a year on a clearly superior player through his age-34 season, especially since they have so much payroll freed up after this season.

I agree with you, Andrew. Between the Granderson love-fest, and the rest, I’ve kept quiet, but this I definitely agree with.
I’d rather they not sign Beltre, but what I have wanted has never really mattered. For what Bay wants, I say let him walk to the Metros, and take the chance on Holliday. This way, they’re still in the hunt to trade for pitching.
If they come out of all this without Bay or Holliday, they’ve made a bad mistake.
Thank god

From Sherman, who incidentally is on-point:
“In general, however, an offer to Bay accentuates the Mets’ growing exasperation with the surprisingly high prices for middle-tier free agents. The Mets have now begun to reason they might as well spend more to get one of the few star-level talents on the market.”
So why the heck would they go after Bay, then, and not Holliday, who looks to be simply a better player? If it’s a matter of Holliday costing too much, doesn’t this go against the notion of ‘might as well spend more’?

Sorry, the “thank god” was the start to another paragraph that I deleted.
The Mets have been said to offered money north of the Red Sox offer to Bay.

So why the heck would they go after Bay, then, and not Holliday, who looks to be simply a better player?
I agree with this as well, and it probably has to do with essentially the same money and not having to deal with Boras:)
Hey, I’m hoping with everything I have that Bay signs with the Mets.

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