My contention is that the secret to Oakland’s success has little to do with the things described in Moneyball, such as the emphasis on finding the skills in baseball that are good at producing runs, but not properly valued by the market.
Billy Beane’s devotees (who have been quite vocal in response to my past postings) would have you think that the way Oakland’s offense generate runs is very different from the way other teams generate runs. As usual, my view is that we should let the data speak. I have assembled the average yearly offensive statistics for five American League teams over the period 2000-2004. The statistics are as follows:
Team…….HR…..AVG……OBP…..SLG……OPS…….R…..SO…….BB
Team A…200…0.276…0.348…0.454…0.802…867…1045…591
Team B…222…0.271….0.351…0.450…0.801…865…1022…638
Team C…202…0.264…0.343…0.436…0.778…838…1029…633
Team D…193…0.269…0.341…0.437….0.778…829…1041…575
Team E…159…0.275….0.349..0.422….0.771…828…1022…619
So two questions for baseball fans:
1) One of these five teams is Oakland. Which one?
2) When you compare these statistics, do you really feel comfortable suggesting that the reason that Oakland has been so incredibly successful can be attributed to the fact that they are following a different offensive strategy than other teams that have achieved roughly the same measure of success (as measured by runs generated)?
The fact is that all of these teams are generating runs in almost exactly the same way. Oakland has been successful because they have great pitchers and because they have had good hitters (who look a whole lot like the good hitters on other good teams). Billy Beane may have done it with a smaller budget, but that is not the point that is in contention. Lot’s of general managers do well with small budgets and don’t get best-selling books written about them. The story in Moneyball was how Billy Beane did it, and that story just isn’t an important part of the true explanation when it comes to generating runs.
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But why isn’t the fact that Billy Beane has generated an equal offense on a smaller budget–and a better pitching staff on a smaller budget–the point at issue? To punch above your weight is a very interesting phenomenon, common to the Oakland As and to U.C. Berkeley…
— JamesThe bugget and the players he is winning with is exactly what the book is about. Sending Tejada to Baltimore because of his salary was a money decision because they needed that money for Chavez. I would say they pay Kotsay much less than Damon and are receiving about the same production. Another part of Oakland systems success is how it has started to penatrate into other organizations like the World Champion Red Sox. I consider this a greater accomplishment then the consistency of winnning teams. A pioneer of the American pasttime is certainly book worthy.
— wmullerBy the time Moneyball came out and became popular, the market had already begun to correct itself. There is a recent paper by Jahn Hakes and Raymond Sauer, professors of economics that studied the issue…I don’t have the link handy, but I remember it used some compelling analysis to show that for a period of time, Oakland was utilizing a niche that other teams weren’t exploiting, but that since the value of what they were doing at Oakland was established, the market then corrected for that…
— Agent BonesProfessor Levitt, the book is called “Moneyball.” It’s called that because it’s about the intersection of money and baseball. The fact that Billy Beane was able to assemble a team that scored lots of runs while spending significantly less money than other teams that scored lots of runs is not tangential to the argument of the book. It’s central to it — as the title, again, indicates pretty clearly. I honestly don’t understand why you persist in offering up such willful misreadings of the book.
It’s not, in the end, clear to me what you think you’re proving with the list of five teams. Any team that successfully scores lots of runs over an extended stretch of time is, almost by definition, going to have a high OBP and a high slugging percentage. Since we all know that the A’s were not the only high-scoring team during the Beane era, it doesn’t exactly come as a surprise that there are other teams out there that drew lots of walks and hit lots of home runs. The point is that while the Yankees ended up on that list by paying Derek Jeter and Alex Rodriguez and Gary Sheffield tens of millions of dollars, the A’s ended up on that list by drafting and developing great young hitters and by signing guys like Matt Stairs and John Jaha and Scott Hatteberg, guys that other teams thought were has-beens or never-wases, but who turned out instead to be genuinely productive offensive players. That’s what Moneyball’s about, about understanding that value doesn’t always come in obvious packages, and that you can put together a top-five offense while spending significantly less money than other squads.
I also would like to see that list from 1999-2002 — the data set that “Moneyball” was based on — because I suspect there would be fewer teams on it that look just like the A’s.
— Steve CarrBy the way, I’d also like to see your list of those “lots of general managers” who have done well over an extended period of time on “small budgets.” I’ll be very surprised if it isn’t a very short list.
— Steve CarrI defy you to find me a serious baseball analyst who really thinks that “the way Oakland’s offense generate runs is very different from the way other teams generate runs.” If you can find a statement anything like that in Moneyball, I’d love to hear about it. I’ll even accept an approving comment by someone fairly well known and/or recognized as having some understanding of the game or sabermetric issues involved. Random blog or Internet forum comments such as mine don’t count.
Others have pointed out that you are disregarding money in this “analysis.” This is certainly a valid complaint. I merely point out that you are engaging in rather transparent straw-man-ism.
Baseball analysts tend to agree that a combination of power, walks, and batting average tend to combine to create runs, and that (for instance) stolen bases are pretty negligible. Neither Beane nor Lewis has claimed, to my knowledge, to have reinvented offense in the way you suggest, and I doubt many of their fans have either.
Unless you can disprove something that people actually think/say/believe, stop pretending to be cleverer than you are.
— MartinTo me, winners get books written about them, while losers don’t. It doesn’t necessarily mean the winners had a better strategy - usually they were just lucky.
— PaulI agree with everyone who says that Prof. Levitt is posing the wrong issue. The real issue is wins per dollar of player payroll. And the question is whether, by that statistic, the Oakland A’s record (over the relevant period) is significantly different (and, if so, by how many sigmas) than the records of all teams in major league baseball (for periods of the same length) going back to, say, 1969 (the year in which the major leagues expanded to 24 teams and began divisional play). All payroll data would have to indexed. But if the payroll data are available, the rest becomes relatively easy. Any volunteers?
— ThomasIt used to go pack, peck, pick, pock, puck. Something to assist a tyke with his vowels. But with its n-1 degrees of freedom and the possibility that a one to one correspondence would be nonlinear in the betas, well this was just too much. One could start and then finish at different places, depending on such arbitrary things as food and drink, the One would become many, dogma and lemma forsaken, no etiology, a tower of Babel, blasphemy.
Snapped out,
d
— robert dWhat correlation exists between winning teams and wurst(sausage)sales?
— Joe S. SausageHi Steven,
— TonyGuitarBoy you drew some flak above. I just discovered bloggo, but humour is a big part of all this. No need for tight shorts here. Here’s a problem for you…eh?
Is this a trick question? When I added up the 1999-2004 runs scored from Baseball Reference & divided by six I get a different answer than teams A to E.
Of course, I could have added wrong or something (very possible).
— AnonymousYour first two sentences give you away. You’re not serious about any of this, are you? Just ruffling feathers. Clever ruse.
I almost fell for it.
‘…not the point in contention…’ is exactly the point in contention.
— Mike‘how Billy Beane did it’ should refer to spend player salary money.
Question 1) Can’t tell. Duh, did you think we should be able to tell? Wrong.
Question 2) Do not. Have not. If I did it would be in regards to steals, which is a strategic element.
you have waaaay too much time on your hands
— Atticus FinchHi Steve, Some people are deadly serious about their pet theories. I wouldn’t want to stand between two baseball stats people in conflict lest there be a stabbing on the stelleto statements of stats. In any case here is a challanging question that would require two years of work for an ordinary economist, but your team of two will post an answer here in a week no doubt.Economisty…scenario,
In a nearby post, you ask ‘ What does this do to our daily life?’ relating to burger consumption. I humbly ask you the similar, but more compelling question,. ‘What does this do to your daily quality of life?’ with relation to losses, frauds and general massive leakage of Canada’s revenues?
I wonder if you, and colleague Kevin Murphy would care to do back-of-the-envelope estimates on the savings to Canadians and find a close number for tax monies saved or rescued if….Adscam losses, Adscam Inquiry costs, 146 million Govt. / Compaq / Hewlett Packard losses…[HP paid back], Corroded Submarine losses and accurate Lottery and gaming funds accounting were taken into account?…
If that task is too huge, what would the savings of revenue wealth be if effective in and out accounting were applied to each ministry and government department? I was flabbergasted as Martin promised to put that in place during his groveling speech. One was an ass for assuming account controls were routine.
Could you roughly estimate to what degree those rescued funds may upgrade say, health-care for example? IN British Columbia, one must wait over two years for knee surgery. Would monies saved be enough to reduce the wait from two to one and a half years?
Are the amounts in question , [while seemingly massive to me] too small to have made much of an improvement in health-care? Heavy economics eh? Complex too, I realize, but useful to every person in Canada who earns under seventy-five thousand. Those folks just buy the medical repair they need.
No, I don’t need knee surgery. The wait time was in a news story. 73’s for now,, TonyGuitar at BendGovt.blog.ca
— TonyGuitarYou should definitely read the article in Playboy about GM’s using stats now. I remember a past article, probably in Maxim, depicting Beane’s strategies and how it is revolutionary compared to the old way of picking prospects (such as how fat one’s ass is). Anyway, I agree Moneyball’s concept is centered around the payroll issue, but as i said, Beane should be ultimately praised for breaking away from older, more speculative manners of choosing future baseball superstars.
— BaronDon’t forget to check out my blog…
Where’s the part where you debunk sabermetric myths or at least say something people don’t already know?
— J. CrossIs it really a good idea to promote a book about unusual applications of valuation by making poorly conceived attacks on a popular and entertaining book about an unusual application of valuation?
— CTDIt sounds like a Freud propagation issue; that is, consider that when Psycho came out, it was shocking and successful because pop-psychology and Freudian analysis were not broadly known. Now that Freudian analysis has intruded deeply into the American cultural consciousness, it has become a less-useful analytic tool because of its ubiquity. The same may be said for the managerial style of Billy Beane vis a vis monetary efficiency.
Or can it?
— ScipioLook across the Bay, Beane fanatics. The Giants have followed the exact same path in both salary and OPS. Start looking at the Giants in 1997 and the As in 1999. There is nothing special about what Beane has done compared with other good GMs, just as Levitt said.
There was no market weakness to exploit in 1999, by the way. Every team that won 90 games that year had an OPS of more than 100 and the Giants had an even higher OPS than the As. All good teams have a high OPS. But not all teams with a high OPS are good. The worst season the Houston Astros have experienced in the past five years has coincided with the team’s highest OPS.
Also, everyone is hung up on wins per dollar spent. Another way to look at it is salary as a percentage of team value. In 2004, the As spent about $59 million on payroll, versus $184 million for the Yankees. According to Forbes, the As were valued at $185 million in 2004 and the Yanks at $950 million. So on a percentage basis, the As spent 32 percent of their total value, while the Yankees only spent 19 percent. By this measure, the As were downright profligate!
— AnonymousI always thought Michael Lewis got the story wrong in its details, although he did get it right in the essentials.
The one essential is that Beane realized that, with a small budget, he had to look for skills that were currently undervalued in the talent market. Such inefficiencies persist only if there is a lot of “traditional” thinking going on, and so long as you have beter analytical techniques. So if OBA is no longer undervalued, someone in Beane’s position would have to conclude that you don’t build an offense around that.
He also realized that the cheapest talent is, in general, young talent. So it becomes imperative to determine which young talent is most likely to be successful. Of course, no one does that all that well in baseball (and there’s a topic to address–why is it harder to project baseball talent than basketball or football talent?). But if you don’t identify the question, you’ll never answer it.
— docThe comparison between the Giants and A’s is interesting, and actually shows why Leavitt’s conclusion is wrong. The relevant points are
i) The Giants and A’s have similar OPS.
ii) However, the Giants do NOT use OPS in evaluating hitters. They hire hitters like Neifi Perez and Mike Matheny!
iii) The Giants have Barry Bonds.
iv) The A’s cant afford Barry, but they craft an equal or superior lineup using much cheaper players.
v) Its the same with the other teams in Leavitt’s list. Sure, they have similar or better OBP/SLG. Buts that because the best and most expensive players have good OBP/SLG. However, there are lots of mediocre players in the major leagues, who are there simply because they “look” good or had a few years with good RBIs or Batting Average, even though they suck. The A’s avoid such players, other teams dont. In the end, the teams that do well on average have similar OBP/SLG, but their rosters are constructed very differently.
Vish
— AnonymousBaseball is a simple game. To win, score more runs than you allow. What Billy Beane did was reject the conventional wisdom. He was willing to look at sabermetrics. Anything for an edge. Yes, obp and pitches/ab was part of this, but this was also how Gene Michael built the Yankees of the 1990’s (not the mercenary team of today). Has the market corrected yet ? Yes. Has the conventional wisdom changed ? No…you still see batting averages in the papers. supposedly, Billy Beane is looking for defense to be mispriced.
That was Michael Lewis’s insight - that trading baseball players is just like trading baseball cards or stocks. There is a market and prices may be right or wrong. Being able to systematically exploit those prices lead to success. Being baseball, that idea generated more conteversy than anything else Mr. Lewis wrote. But the is just “Liar’s Poker” on the ball field. And I mean that as high praise.
— andy“The A’s cant afford Barry, but they craft an equal or superior lineup using much cheaper players.”
Well, not really.
The assumption that Brian Sabean’s job is easier because the Giants have Bonds is wrong. Actually, from a payroll stand point, it’s more difficult. He starts off every off-season with 20 percent of his payroll already committed to one player.
There was a $7 million difference between Bonds and Jermaine Dye, the As highest paid player, in 2004. There’s about an $8 million difference between the next four highest paid players on each team. In 2004, the Giants actually had a lower median salary than the As. In fact, the As had a higher median salary than all but three of the teams that made the play offs (those teams were the Yankees, Red Sox and Angels).
Now, I realize this after the supposed “market correction” (which I don’t buy into, by the way). But it still disspells the notion that the As are spending less for better results. They rode a half dozen good young players until they couldn’t afford them. What happens next is the real test.
— Anonymoushttp://papers.ssrn.com/sol3/papers.cfm?abstract_id=618401
— Anonymous