Presentation Title

Monetary Mound: Econometric Analysis of Pitcher Salary

Presentation Type

Oral Presentation

School

School of Sciences and Social Sciences

Discipline

Economics

Mentor

Marie Duggan

Date & Time

April 9th at 10:15 AM - 11:15 AM

Location

L. P. Young Student Center, West Dining and Flag Room

Abstract

Do Major League Baseball (MLB) pitchers receive pay commensurate with their on-field performance in the year they become a free agent? This contribution is known as marginal revenue product in economic theory. The purpose of this study is to determine if current pitchers were paid according to their on-field performance during the last year of their contract, examine if team pitching performance contributes to wins, and estimate determinants of team revenue. In conclusion, 68% of pitcher pay is explained by on field performance, wins are found to be statistically insignificant in determining revenue, and the marginal revenue product of pitchers is found and compared league-wide.

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Apr 9th, 10:15 AM

Monetary Mound: Econometric Analysis of Pitcher Salary

L. P. Young Student Center, West Dining and Flag Room

Do Major League Baseball (MLB) pitchers receive pay commensurate with their on-field performance in the year they become a free agent? This contribution is known as marginal revenue product in economic theory. The purpose of this study is to determine if current pitchers were paid according to their on-field performance during the last year of their contract, examine if team pitching performance contributes to wins, and estimate determinants of team revenue. In conclusion, 68% of pitcher pay is explained by on field performance, wins are found to be statistically insignificant in determining revenue, and the marginal revenue product of pitchers is found and compared league-wide.