In Major League Baseball, money still isn’t everything. Not yet, anyway.
Over the course of the 2021 season, the relationship between the number of games an MLB team won and its opening day payroll measured out at a relatively modest 40 percent.
Four of the 10 highest-payroll teams qualified for postseason play, but so did five teams from the middle tier and one – the Tampa Bay Rays — from the bottom 10.
Money isn’t everything in MLB
The Rays won 100 games despite a $66.75 million Opening Day payroll that ranked only 26th among the 30 teams.
Over the past decade, the relationship between team payroll and wins has averaged just under 40 percent, although it has varied fairly widely from season to season.
The relationship peaked – at 62.2 percent – in 2016 and again in 2017. It hit a decade low of just 16 percent during the Covid-shortened 2020 season.
In 2019, the comparable figure was 41.1 percent, so the calculation for 2021 represents something of a return to a historical norm.
The strength of the relationship between team spending and victories is determined using a mathematical formula called Regression Analysis. In civilian terms, Regression Analysis is a tool that can broadly infer causal relationships between two sets of data, such as payroll and wins.
Obviously, the inference is only broad – lots of factors can influence team performance – and should only be taken that way.
In 2021, the two best-paid teams – the Dodgers ($247 million) and Yankees ($198 million) – both qualified for post-season play. The third and fourth highest, however – the Mets ($195 million) and Phillies ($191 million) did not.
Among the 10 highest payrolls, the Astros (fifth at $188 million) and Red Sox (eighth at $180 million) also made it. But the Nationals, Angels, Padres, and Twins all finished below .500 despite spending a cumulative $696 million.
Among the 10 lowest spending teams, the Oakland Athletics (23rd at $84 million) and Mariners (25th at $73 million) both joined the Rays above .500.
That is not to say that money is no factor in winning. The four teams that lost 100 games in 2021 – the Diamondbacks, Rangers, Orioles, and Pirates – all ranked among the 11 lowest-paid teams.
Perhaps strangely, the 10 mid-tier teams based on salary – the Cardinals, Giants, Cubs, Blue Jays, Braves, White Sox, Reds, Rockies, Brewers, and Diamondbacks — slightly out-performed their richer cousins. Those mid-tier teams averaged 84.4 victories, nearly one win more than the 10 best-paid teams (83.8 victories.)
The 10 lowest-paid MLB teams only averaged 74.7 victories in 2021.