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Economics in Nine Innings

Thursday, May 3, 2007

The national pastime helps explain the “dismal science.”

The Baseball Economist: The Real Game Exposed, by J.C. Bradbury (Dutton Adult, March 2007)

Baseball EconomistGood professors of introductory economics have one thing in common. Whether they are the embodiment of “accountants, but without the personality” or can enthrall their class in the art of widget-making, the best instructors make their students see that economics is about understanding human behavior, not just running a business or drafting public policy. In The Baseball Economist: The Real Game Exposed, J.C. Bradbury accomplishes this task, demonstrating the essence of economics by applying it to the game he loves.

Make no mistake; this book is more about economics than about baseball. While the entire book pertains to Major League Baseball (MLB), each chapter deals with one or more economic concepts, which Bradbury uses to tackle various aspects of the game. In fact, the author touches—to one degree or another—nearly every topic covered in a typical freshman microeconomics course.

But The Baseball Economist is no textbook; and devoted fans will appreciate what economic analysis can reveal about the game. In one chapter, Bradbury uses regression analysis and the concept of elasticity to determine the relative importance of batting average, slugging percentage, and on-base percentage in predicting a team’s run production—the sort of analysis made famous by Moneyball. To explain a player’s decision to use performance enhancing drugs, he sets up a game theory matrix, which yields a Nash equilibrium under which the hypothetical players always decide to use steroids. Bradbury then takes what economists believe about incentives to propose a policy that would be more successful in curbing the practice than the recent one agreed to by the players union and MLB.

His econometric work also disabuses us of several widely-held misconceptions, such as the notion that a quality on-deck hitter makes the batter at the plate more successful (“Protection is a myth”), as well as the purported advantage teams have by playing in big-markets (although the size of New York relative to Kansas City gives the Yankees a clear advantage, “inept management” on the Royals’ part has had a greater impact on the disparity in wins). 

Yet interesting as these unique analyses are, they fall short of answering what, for many fans, are the most burning questions about the game. The Baseball Economist does not, for example, tell us whether the introduction of designated hitters in the American League in 1973 was a mistake, justify following baseball as a noble use of time, or provide an account of just how evil the Yankees actually are (the club’s mammoth payroll advantage cannot be just, can it?). Consequently, many baseball fans who finish this book may be left wanting more. But in feeling empty or frustrated by what Bradbury has not told them, these readers have discovered another important aspect of modern economics—its incorporation of the fact-value distinction, a dichotomy embraced by nearly all the social sciences.  

Sabernomics, Bradbury’s term to describe the combination of standard economic reasoning with sabermetrics, the use of statistics to obtain “objective knowledge about baseball,” to quote Bill James, also operates according to this fact-value distinction. While sabernomics can demonstrate that the introduction of a designated hitter increases by 11-17 percent the rate at which pitchers hit opposing batters, it cannot tell us whether the DH has been “good for baseball.” Likewise, sabernomics can predict the effects of the Yankees’ market size and payroll on its competitiveness, but to call this “unjust” or “unfair” goes outside its bounds. This division between positive and normative economics is of utmost importance in understanding the discipline, as it surfaces constantly in public policy debates. It is to the author’s credit and the precision of his analyses that readers will apprehend this aspect of economics without it being addressed directly.

Many baseball fans who pick up this book looking for an edge in their fantasy leagues or simply a better understanding of MLB’s intricacies will likely find what they’re looking for. But by the time they are through, they will recognize as a positive externality the first-rate introduction to economics that was Bradbury’s purpose in writing his book.

Daniel Geary is a research assistant at the American Enterprise Institute.

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