Monday, January 10, 2005

Marchman's Multiphasic Met MRI
& Measuring Money  

I've written quite a few times in the last six months about Carlos Beltrán's free agency, most recently here. The Manati Manatee, as he's known by his teammates, signed this weekend with the New York Mets, giving that franchise a quinella in attention-getting around free agent acquisition this Winter. Beltrán was the Position Player Most Likely to Foment Fan Frisson available through free agency, and the team had already plopped a big ol' Mr. Met head on the Pitcher Most Likely to Foment Fan Frisson, Pedro Martínez.

There are two worthwhile aspects for managers to observe: a masterpiece of quick metrics, and an important, and often-ignored, strategic trend.

There's a ton of discussion around the 7-year, $119 million contract, & with one exception so far, it's seemed like a waste of ink or electrons or both.

The standout exception was Tim Marchman's analysis over at the New York Sun (pointed at by Larry Mahnken at Baseball Primer). While most commentators in both the uninformed jock press and the informed sabermetric press and the are saying they like it or they don't based on one or two overarching opinions, Marchman synthesized several sabermetric measures that probably captured what the Mets went through themselves to try to value the deal. More than that, he distilled it down so the presentation would be understandable to any interested reader.

Provocatively headlined "Why Mets Overpaid For Beltran," he presents the deal through a thorough set of complementary measures, aiming to assess the value of Beltrán's play in team wins over what the team might otherwise have achieved, not just this coming season, but for the life of the contract. His discussion embraces Beltrán's hitting (results adjusted by the player's home park), his exceptional base-stealing (not a critical element for most teams, but The Manati Manatee is consistently so exceptional in his success ratio that it's actually worth noting), and his defense.

Marchman then taps into Nate Silver, one of the more interesting Sabermetricians, for an insight into a projected value for the player over the life of the contract. He quotes Silver's dollars-per-win number for Beltrán (the bolding is mine):

While the system only projects five years out, Silver's best guess is that Beltran will be worth about 7 WARP over the last two years of the deal, for a total of about 39 WARP over the course of the deal, or a hair above $3 million per win.

"The going rate this winter has been about $2.25 million per win, using the same PECOTA-based method," Silver wrote me in an email, "so he's overpaid even by this winter's lofty standards. It's the sixth and seventh years that do the trick; something like $17 million for 5 years wouldn't have been so out of line."

Now, if Marchman was writing a 3,000-word piece for a scholarly journal instead of a 600-word analysis piece for a newspaper, there would have been room to contextualize a little more and answer some other questions that would provide additional context to what Beltrán is worth to the Mets, specifically.

For example, fielding is not a lone measure. To some degree, Beltrán's fielding dovetails with the players fielding around him. On the Mets, he's going to be playing next to Mike Cameron, perhaps the rangiest outfielder in the majors. (Historically a center-fielder himself, Beltrán will likely move to right field because he has a better arm than Cameron, but it's a position he hasn't played much in the majors. ¿Will that degrade his defense to any degree?). Beltrán has better than average range and this will make for an interesting point to observe, because intuitively, fielding shouldn't be additive beyond a point. That is, Cameron runs down a lot of balls in right-center that an average center-fielder wouldn't, and Beltrán would run down a lot of fly balls in right-center an average RF wouldn't -- but they can't be additive. They can't, because a certain incremental number of the extra fly balls Beltrán will run down would have been incremental extra fly balls Cameron would have run down. If this doesn't seem clear, let's make the case more extreme using an example I used for a young fan sitting next to me at a game a few years back. Imagine the new team in D.C. had The Flash playing centerfield and Supergirl in right. Flash gets to everything in the outfield. But so would Supergirl if she were playing next to anyone who wasn't The Flash -- say, Manny Ramírez (The Outfield's Anti-Flash). But they will still only get to the same number of fly balls whether the team has Supergirl or Ramírez playing next to Superman. Outfield chances are not purely additive, because incremental fly balls that one might get are incremental fly balls the other has already harvested. On the other hand, the effect of harvesting incremental fly balls isn't linear. I'm still working on the numbers, but the effect on the offense of having the outfield harvest more icnremental fly balls doesn't go down consistently with in the percentage of additional fly balls a rangy outfield harvests.

And base-stealing is highly contextual, too. Beltrán's value to the Mets here might be a little higher than it would be to another team. Last year, the team tried to steal more bases than the average team, and had a higher success rate, too. On the other hand, they have a new manager, but, as The Incredible Two-Headed Transplant said to Bruce Dern, on the other other hand, the new manager is Willie Randolph, who was an accomplished base-stealer himself early in his career and who did it with less success when he was Beltrán's age. Managers who were successful base-stealers tend to have their teams steal.

But all additional contextualization aside, Marchman's metrics were easily the best analysis written on the signing. And by using Nate Silver's price-per-win quote and also the phrase I bolded in the quote above, Marchman gave us another point to chew on, which is: ¿What IS Overpaid, and Why Are 2005's Signings "Lofty"?

The answer is "The Plexiglass Principle".

Baseball researcher Bill James explained this natural law in his 1982 Baseball Abstract (I think that's the first Abstract mention). Here's the analogy: If you take a sheet of plexiglass and push in the edges so it bends, when you ease off, the sheet, aiming for its original shape, not only flattens out to its original shape but tends to go past that point to where its shape is curved in the opposite direction. The farther you deform the sheet away from its state, the farther it will overshoot in the oppostie direction. James' Principle posits that trends tend towards their historical mean and will tend to overshoot that mean in the opposite direction.

So Silver thinks this year's free agent signings are "lofty". But they're not lofty by all standards, just by the last couple of years' standards. Alex Rodriguez, Carlos Delgado, Kevin Brown et.al. were signed to bigger current-dollar deals in the 1998-2000 offseasons' period, and the lesser contracts singed during that time were bigger current-dollar deals, too, if you had projected Silver's ratios.

It's just that the League viewed those contracts as a group as untenable, and team owners then controlled their relative spending in the 2001-2003 offseasons' period. The 2004 season looks like the trend is boing-ing back towards the spendy.

And here's the management lesson (and an additional reason why it happens) from those changes: Trends are not linear. Never. And human perception of trends gravitates towards the assumption of linearity. Always.

People assume things will go on the way they've trended. It's the easiest, most passive way to project the future, and mediocre managers most usually go for the easiest, most passive option. In the odd cases when a trend really is linear, it's an exceptional fluke.

This spendy boing-ing is not random, I believe. It's also a natural function of owners' pocketbooks and their competitiveness. By suppressing spending for three off-seasons, owners as a composite built up higher cash reserves, so they didn't view player prices in the same way -- relative to their available cash. The longer they held off ultra-premium contracts, the more moeny they felt they had on hand to pay contracts. That's Plexiglass in action: The farther you deform the sheet away from its state, the farther it will overshoot in the oppostie direction, the more apparently-available cash on hand, the greater the competitive organization's desire to invest it in winning. Shoot, if the owners had held the line for another couple of offseasons, Paul Bako might have been getting one of these Beltrán-sized contracts.

TIP #314
Don't ever assume it's realistic to think a trend will continue on a straight line. And frequently the act of fighting a trend will create more of the force that runs counter to the trend.

Or as The Incredible Two-Headed Transplant said to Casey Kasem: Must sign Giant contracts...NOW.

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