Excellent players signed to reasonable contracts are the new market inefficiency
Market inefficiency is the new black.
Moneyball, despite what Murray Chass thinks, was not about VORP. It was about one general manager identifying a widespread anomaly in baseball’s marketplace and exploiting it. At the time, players with high on-base percentages were not paid in accordance with the way they helped their teams win, so Billy Beane stockpiled them for his Oakland A’s.
Today, now that the value of OBP is more widely recognized, everyone’s searching for the new market inefficiency. This offseason alone, I’ve read how older players are a market inefficiency and how versatile players are a market inefficiency. And though players who rated well on defense were recently considered another market inefficiency, Ken Davidoff reported earlier this offseason that some baseball people now felt they were being overvalued.
I’m confused. And I’m beginning to wonder if, in a post-Moneyball world with so many analysts and bloggers and GMs out to find the new market inefficiency, it isn’t increasingly difficult for that single marketwide inefficiency to actually develop.
Now I can’t purport to know exactly how baseball teams operated before Moneyball, or, heck, even now. But the book sure made it seem like nearly all the Major League teams were zigging and Beane was zagging, and that’s what allowed him to take advantage.
Clearly that is no longer the case. Beane’s proteges and advocates of advanced metrics have spread throughout the league, and many are working, just like we are, to identify the best way to help their club win at the most reasonable cost. In other words, it’s a lot harder to practice moneyball now that everyone’s read Moneyball.
That’s my guess, at least.
Which is not to say it’s impossible to find a particular team that overvalues or undervalues a particular asset and exploit it. The Mets — at least according to Omar Minaya — seem to think Gary Matthews Jr. still has something to offer defensively, whereas any team with access to Fangraphs would likely disagree. So bully for the Angels for taking advantage of that, and getting what appears to be an anomalous return for their sunk cost.
Nor is it to say a team can’t find a great value on a free agent past his prime. They can, of course. But it has to be a good free agent past his prime, and one likely to return more value to his club than he’s compensated for. And there aren’t exactly a ton of those players flopping around. If simply stocking up on old guys made you a shrewd baseball economist, Michael Lewis would have written a book about Brian Sabean by now.
Same goes for versatile players that can allow a team to make better use of their available roster spots. If they’re good and available at reasonable rates, they can be immensely valuable to a team. If they’re Joe McEwing, they aren’t.
So it strikes me as too easy to say one type of player or another represents a new market inefficiency, or at the very least overstated. For an inefficiency to truly develop, the bulk of teams would have to be undervaluing a particular, measurable skill, and neither old age nor versatility is necessarily that, nor is it clear that most Major League clubs are ignoring those types of players.
It’s entirely possible, even in this day and age, that some aspect of winning baseball is being undervalued and that someone will be able to take advantage of it, but it appears from this angle like the best way to operate is trying to identify the bargains on a case-by-case basis rather than pursuing some elusive, overarching secret key to success.
