Do Team Salaries Have an Impact on Winning?

Posted on behalf of Craig Gannon:

http://baseball.about.com/od/newsrumors/a/09teamsalaries.htm

For years and years the question has been asked if whether or not Major League Baseball needs a salary cap. Every off-season there are key free agents that can be acquired to help out teams. However, the same teams seem to be in the mix every year. The Yankees, Red Sox, Mets, and Cubs had the highest payrolls in 2009, with the Yankees being the off-season winners. For fans of teams who are not at the top, proposes the question if MLB needs to revise their current system. However, for better or worse in the new millenium we have noticed that teams with low salaries (Marlins, Rays, Twins, A's) have had an impact in baseball and managed to be very successful teams. The Oakland A's were the best example of this. General Manager Billy Beane ( a former player himself) managed to build the A's from the ground up and drafted a solid foundation for his farm system. The A's arguably had the best three pitchers in basbeall (Hudson, Mulder, Zito) and one a number of AL West titles. Beane new that he was in a tough situation and took a different approach then most. He managed to, "acquired baseball players who had high on-base percentages (OBP) and slugging percentages (SLG), virtually ignoring their fielding statistics and speed (Lewis, 2003, p. 32). Hakes and Sauer (2006) suggest that Beane valued individual player characteristics quite differently from other owners and general managers" (Brown and Jepsin 193).

If we look at more recent history the Minnesota Twins have took Beane strategy and helped build their team into a winning franchise. Every year the Twins find someway to sneak there way into the playoffs. Who would of thought that on the last game of the season the Twins would of fought all the way back to have a tie-breaker with the Tigers (who led the division basically all year). There hasn't been one year where the Twins have acquired a major free agent, its almost as if their giving their own free-agents away. However, they managed to keep a solid farm system and acquire veteran players to help keep the team in tact. In a move that came somewhat unnoticed was the acquisation of Orlando Cabrera. The Twins were a very young team and having a sub par year. However, the veteran leadership that Cabreara brought to this team was huge.

Who is to say that the twins cannot be the AL champs if they beat the Tigers? They are the hottest team in AL. However, they have the 24th lowest salary in the majors. This goes to show that teams with the largest salary does no always mean success. The Marlins, Rays, Rockies to name a few are examples of this. Teams with young players and low salaries have found a way to win and compete amongst the best. Does this show a new wave in baseball for years to come?

Furthermore, Teams with lower salaries do not have the funds to create many opportunities to make profit. Every year professional teams are trying to build new stadiums in order to further their respective franchises. Recently, in the NBA the Nets finally found a investor to help build there stadium in Brooklyn. Prior to this announcement it looked as if the Nets moving to brooklyn was dead. In baseball it seems as if there are the same problems. The Marlins, Twins, Rays, and Rockies four of the more successful low salary teams, have played in the same stadium since their existence. How do they expect to compete with other teams in acquiring players when they have no investors to further their franchise. According to Leeds and Pistolet, "Economic studies generally conclude that teams reap large profits from new, municipally funded facilities" (Leeds and Pistolet 581). New stadiums bring in more excitement, therefor, having more fans attend games. The Marlins and Rays are at the bottom of league attendance, with no interest of investors, therefore managing to stay towards the bottom in team salary.

This proposes the question where is the line drawn? How can MLB come up with a way where every team has a fair shot and competing for free-agents. Even though recent history shows that salary necessarily doesn't have an impact on winning, teams like the Yankees, Red Sox, Mets, and Cubs have a much better chance every year. What do you guys think, should MLB baseball have a salary cap and if so why? Or do you think baseball is fine where it is (putting your favorite teams position aside)?

NFL not immune from struggling economy

The NFL brings in the most revenue of all of the four major sports in the U.S. However, even Roger Goodell and company have not been able to avoid the economic woes which have plagued the nation over the last few years.

One of the biggest ways that NFL teams bring in money is by selling the naming rights of the stadiums they play in to a large corporation for an absurd sum of money. But recently, even that has not been a guarantee for some teams. Los Angeles has been trying to build a stadium for the last 15 years so they could lure a team back to town, but plans have stalled now in part because no corporation will pay money to put their name on the stadium. http://latimesblogs.latimes.com/lanow/2009/09/agreement-gives-proposed-nfl-stadium-in-industry-a-boost.html

Jacksonville is struggling more so than any other franchise right now. The are one of lowest valued franchises in the league, they have the second lowest average ticket price, and have been unable to sell out the stadium this season. Their stadium is publicly owned, and does not have a name on it, which is a huge chunk of money that the Jaguars are lacking. http://www.nytimes.com/2009/10/03/sports/football/03jaguars.html

This habit of naming stadiums is in fact a fairly new concept. As of 1990, there were no baseball stadiums with corporate names; as of 2001, the majority of baseball, basketball, football and hockey arenas had sold their naming rights to large corporations (Leeds and Pistolet 584).

And while some may think that naming a stadium Heinz Field (thought you'd like that Prof. Burns), or the TD Bank Sports Center, the main reason is for the money. We cannot for get that sports are a business. Of course a franchise wants to win and be successful, but just as important and if not more important is the ability for that franchise to make money (Lavoie 162).

Do you wish that we could go back to the days where the communities took the brunt of the financial burden, and we would have more "Municipal Stadiums"? Do you think that there will ever be a situation, such as a tanking economy, where we will go back to a situation like that?

Whether you like having these named stadiums or not, it's impossible to ignore the financial impact that naming rights can have for a professional franchise.