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Economics, Baseball, and the Value of Pitching


Twins Daily Contributor

It is no secret that every Twins fan on social media wants pitching. When Carlos Correa signed for at least six more years, many fans still asked, “can he pitch?” or “why aren’t we getting any pitchers?” Every pitching acquisition comes with a cost, whether money or players. Good pitching costs more than good hitting, and the Twins were in a perfect situation to acquire pitching. Let’s dive into it.

Image courtesy of Bruce Kluckhohn/USA Today

Last year, the Twins starting pitching ranked 20th in ERA, 18th in FIP, 23rd in K/9, and allowed the 11th most HR/9. If this team was going to improve from a .500ish team to a playoff team, starting pitching needed to be upgraded. Enter Pablo López.

In case you haven’t seen, All-Star 1B/DH Luis Arraez was traded to the Miami Marlins for López, INF Jose Salas, and OF Byron Chourio. Arraez hit .316/.375/.420 last year with a 131 wRC+. López was 10-10 with a 3.75 ERA and a 3.71 FIP. Arraez put up a 3.2 fWAR season compared to López’s 2.8. However, Arraez has an extra year of team control, which is why the Twins had such a high asking price for the 25 year old.

According to Baseball Prospectus, Salas is the 93rd-best prospect, and Chourio had a .838 OPS in the Dominican Summer League as a 17-year-old.

More than ever, pitching is at a premium in Major League Baseball. In the 2022-23 offseason, MLB teams usually receive more bang for their buck when signing position players instead of starting pitchers on the free agent market. As we have seen in the past few years, the current Twins front office prefers to trade for starting pitchers, and this premium on the free agent market could be the main reason.

Using Steamer’s 2023 projection system, we can see how each player projects in the 2023 season. In the age of analytics, the primary statistic that gets players paid is Wins Above Replacement. On average, the top 31 free-agent starting pitchers this offseason signed for $7.21 million per WAR accumulated. On average, the top 31 free-agent position players signed for $6.44 million per win. This shows how much pitching is valued in today’s game and how teams are willing to spend more money to get more pitching.

Like many professional sports executives, Derek Falvey was an economics major and knows that running a successful business or franchise is challenging. To get something, you must give something in return.

The first two economic principles you will learn in an ECON 101 class are scarcity and opportunity cost.

Scarcity means that the demand for a good (or, in our case, player) will always be greater than the availability of that good. In the current game of baseball, above-average pitching is more scarce than a first baseman with an OPS of around .800. Pitching is so valuable, and every team needs it. While Arraez is a great player and probably more valuable by WAR than López, he plays a position full of guys who can produce offensively, reducing his value. As we saw with the Twins last year, good pitching is scarce. López is not an ace by any means, but he would've led the Twins staff in pitching WAR (2.8) and innings pitched (180) in 2022. Above-average pitching isn't something the Twins have had much of in recent years, so López should significantly improve their pitching staff.

Opportunity cost is the second economic principle used in every business decision. Opportunity cost is the loss of potential gain from other alternatives when one alternative is chosen. Every dollar you spend on a player is a dollar you can’t pay another player. Every dollar you give Correa is a dollar you can’t spend on pitching, and vice versa. This Twins front office may see it advantageous to spend big money on position players, given the market premium for pitching.

The opportunity cost of trading Arraez is lower than one may think. You may get a slight decrease in production at first base from Jose Miranda and Alex Kirilloff, but both have shown that they are more than serviceable options. You are downgrading slightly in the infield and effectively upgrading from Bailey Ober to López while adding to the improved rotation depth.

Another reason the Twins could trade Arraez was their surplus of infielders. The Twins now have seven infielders on their 40-man roster. They are Correa, Jorge Polanco, Miranda, Kirilloff, Royce Lewis, Kyle Farmer, and Edouard Julien. Correa, Polanco, and Miranda are all but penciled into the opening-day lineup. Kirilloff has had some of the best batted-ball data in the league when his wrist has been healthy. Lewis looks to be a future difference-maker once he returns mid-season from his second torn ACL. Farmer is a utility infielder who is solid defensively everywhere and hits lefties well. Julien had a .931 OPS in AA last year and a 1.248 OPS in the Arizona Fall League across 96 plate appearances.

The only infielder among these seven who is worse defensively than Arraez is arguably Kirilloff, but he is first base only as a left-handed thrower. Arraez was only seen as a 1B/DH by the Twins' front office, significantly diminishing his value as a player.

Once Lewis is ready to go, and Brooks Lee gets to the majors, Miranda would move to first, creating an odd-man-out situation. Having so many infield options that could be plugged in and perform well is a good problem.

Economics always factor into these decisions that can make or break a franchise. Many decisions come down to opportunity cost and all the different routes front offices can take from offseason to offseason.

Nobody likes it when their favorite player is traded. It sucks. It can make it less enjoyable to watch a team, and Arraez is one of the most fun Twins players in the last ten years. But putting all personal bias aside, from a business standpoint, this move makes sense. You are giving up a player at a position where you have a surplus of options in exchange for a position with less talent.

Thank you for reading, and Go, Twins!


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High demand, low supply, high injury frequency will produce incredible costs to acquire very little. 

The Twins currently have 9 decent starters. Other teams are stock piling starters beyond 5 because nobody can keep them healthy. 

This just increases the demand and lowers the supply even more. 

If you are going to corner a market... this is the corner to focus on. 

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1 hour ago, Riverbrian said:

High demand, low supply, high injury frequency will produce incredible costs to acquire very little. 

The Twins currently have 9 decent starters. Other teams are stock piling starters beyond 5 because nobody can keep them healthy. 

This just increases the demand and lowers the supply even more. 

If you are going to corner a market... this is the corner to focus on. 

This sounds like insanity! Are pitchers being coached to stress their arms and bodies beyond what is physically sustainable? I don't have any knowledge on the matter, just putting the question out there.

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21 minutes ago, NotAboutWinning said:

This sounds like insanity! Are pitchers being coached to stress their arms and bodies beyond what is physically sustainable? I don't have any knowledge on the matter, just putting the question out there.

Throwing a baseball is unnatural and puts a lot of stress on your arm. It’s just about managing that and making sure there isn’t a crazy amount of overuse

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15 minutes ago, miracleb said:

This sounds like insanity! Are pitchers being coached to stress their arms and bodies beyond what is physically sustainable? I don't have any knowledge on the matter, just putting the question out there.

 

Ummm.....yes

I truly believe that injuries are up, have not done the full research just basic observation.  It could be that we only hear more about it because back in the day if you tore your UCL in the minors or early in career, you were basically done, now it is the norm to get the surgery and come back.  The guys that could pitch at high level that did not tear it were the ones we saw.  I cannot say pitchers are doing more than the prior generations have been asked to do.  It would be interesting to look back years ago and see how many people tore the UCL and we just never heard of them because they never made it to majors.  

The other reason I believe so is that overall velo is up.  I remember when average FB was like 89 to 90, back in the 90's.  Then you had guys like Ryan and Clemons that were throwing much faster, and many more pitches per outing.  I remember when a guy throwing 95 was heat, and if they could get to upper 90's it was rare.  Now, if you cannot hit 100 or more you are not a power FB guy.  I believe this is leading to additional stress on arms that lead to more injuries.  The moment a guy loses 1 or 2 MPH on FB their careers are considered over, unless they become a junk baller that still can get outs, but they normally get passed on for high velo guys. 

The art of pitching has changed, for better or worse, and we just need to adjust to it.  I remember the old school guys would talk about trying to get that little extra when needed, but would really try to coast by when could.  Now, it seems every inning they are going for that extra, and the Twins are basically preaching to go all out for 5 innings, and then turn over to pen.  

In part I think pitchers are so concerned about K's per 9 because that is what people are looking at for effectiveness.  It also affects FIP so much and teams are paying for FIP more than ERA now.  So why take it easy on a light hitting guy using 1 pitch to get him out by throwing it over hoping they get the quick out, when using 6 or 7 pitches to get the K will get you paid more. 

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1 hour ago, NotAboutWinning said:

This sounds like insanity! Are pitchers being coached to stress their arms and bodies beyond what is physically sustainable? I don't have any knowledge on the matter, just putting the question out there.

That is an excellent question NotAbout. I have been thinking that also. In fact I posted something about that yesterday.

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27 minutes ago, Trov said:

I truly believe that injuries are up, have not done the full research just basic observation.  It could be that we only hear more about it because back in the day if you tore your UCL in the minors or early in career, you were basically done, now it is the norm to get the surgery and come back.  The guys that could pitch at high level that did not tear it were the ones we saw.  I cannot say pitchers are doing more than the prior generations have been asked to do.  It would be interesting to look back years ago and see how many people tore the UCL and we just never heard of them because they never made it to majors.  

The other reason I believe so is that overall velo is up.  I remember when average FB was like 89 to 90, back in the 90's.  Then you had guys like Ryan and Clemons that were throwing much faster, and many more pitches per outing.  I remember when a guy throwing 95 was heat, and if they could get to upper 90's it was rare.  Now, if you cannot hit 100 or more you are not a power FB guy.  I believe this is leading to additional stress on arms that lead to more injuries.  The moment a guy loses 1 or 2 MPH on FB their careers are considered over, unless they become a junk baller that still can get outs, but they normally get passed on for high velo guys. 

The art of pitching has changed, for better or worse, and we just need to adjust to it.  I remember the old school guys would talk about trying to get that little extra when needed, but would really try to coast by when could.  Now, it seems every inning they are going for that extra, and the Twins are basically preaching to go all out for 5 innings, and then turn over to pen.  

In part I think pitchers are so concerned about K's per 9 because that is what people are looking at for effectiveness.  It also affects FIP so much and teams are paying for FIP more than ERA now.  So why take it easy on a light hitting guy using 1 pitch to get him out by throwing it over hoping they get the quick out, when using 6 or 7 pitches to get the K will get you paid more. 

Plus there are less contact hitters and more guys getting paid big bucks to hit home runs. We have HR derbies. We do not have derbies  for singles hitters to slap balls into circles in the OF. More and more now, pitch to contact  results in a homerun.

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1 hour ago, tarheeltwinsfan said:

Good post Andrew. I received my economics degree from the University of North Carolina. Unlike many of the other subjects which I took in college, economics just always made sense to me. And so did your fine article. Thank you for writing it. 

Thank you!

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3 hours ago, NotAboutWinning said:

This sounds like insanity! Are pitchers being coached to stress their arms and bodies beyond what is physically sustainable? I don't have any knowledge on the matter, just putting the question out there.

I was sleeping in med school so I really can't answer this question... However, my assumption is yes. 

People like to talk about the old days and how pitchers used to be able to throw a million innings a year but we are at a whole new level now from the old days. 

It was celebrated decades ago if the rare pitcher hit 97 mph. 100... maybe 1 or 2. We got a bunch of those guys now. Is this more than the human body is capable of sustaining? ... like I said... I was sleeping in med school but my assumption is Yes. 

If we have seen an increase in the 100 mph arms... you have to assume that everyone has bumped up their ceilings.

The 94 mph guy from yesteryear is throwing 100 now. The 87 MPH guy from yesteryear is hitting 93MPH and maybe that is beyond his sustainability. 

Today's play throws harder, runs faster, jumps higher than the player from past decades. Maybe we have crossed a line. 

Just spitballing because I was sleeping in med school.  

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2 hours ago, Riverbrian said:

I was sleeping in med school so I really can't answer this question... However, my assumption is yes. 

People like to talk about the old days and how pitchers used to be able to throw a million innings a year but we are at a whole new level now from the old days. 

It was celebrated decades ago if the rare pitcher hit 97 mph. 100... maybe 1 or 2. We got a bunch of those guys now. Is this more than the human body is capable of sustaining? ... like I said... I was sleeping in med school but my assumption is Yes. 

If we have seen an increase in the 100 mph arms... you have to assume that everyone has bumped up their ceilings.

The 94 mph guy from yesteryear is throwing 100 now. The 87 MPH guy from yesteryear is hitting 93MPH and maybe that is beyond his sustainability. 

Today's play throws harder, runs faster, jumps higher than the player from past decades. Maybe we have crossed a line. 

Just spitballing because I was sleeping in med school.  

Good points River.  Speaking of sleeping during med school, at my last colonoscopy, the doctor walked into the operating room before I was put to sleep. He asked me how I was doing. I said I was doing fine. He proceeded to tell he he had been up all night drinking. I guess that is an old  gastroenterologist joke. 

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6 hours ago, Trov said:

I truly believe that injuries are up, have not done the full research just basic observation.  It could be that we only hear more about it because back in the day if you tore your UCL in the minors or early in career, you were basically done, now it is the norm to get the surgery and come back.  The guys that could pitch at high level that did not tear it were the ones we saw.  I cannot say pitchers are doing more than the prior generations have been asked to do.  It would be interesting to look back years ago and see how many people tore the UCL and we just never heard of them because they never made it to majors.  

The other reason I believe so is that overall velo is up.  I remember when average FB was like 89 to 90, back in the 90's.  Then you had guys like Ryan and Clemons that were throwing much faster, and many more pitches per outing.  I remember when a guy throwing 95 was heat, and if they could get to upper 90's it was rare.  Now, if you cannot hit 100 or more you are not a power FB guy.  I believe this is leading to additional stress on arms that lead to more injuries.  The moment a guy loses 1 or 2 MPH on FB their careers are considered over, unless they become a junk baller that still can get outs, but they normally get passed on for high velo guys. 

The art of pitching has changed, for better or worse, and we just need to adjust to it.  I remember the old school guys would talk about trying to get that little extra when needed, but would really try to coast by when could.  Now, it seems every inning they are going for that extra, and the Twins are basically preaching to go all out for 5 innings, and then turn over to pen.  

In part I think pitchers are so concerned about K's per 9 because that is what people are looking at for effectiveness.  It also affects FIP so much and teams are paying for FIP more than ERA now.  So why take it easy on a light hitting guy using 1 pitch to get him out by throwing it over hoping they get the quick out, when using 6 or 7 pitches to get the K will get you paid more. 

The major surgeries are up, probably partly because they're getting better and more reliable and maybe because there are more injuries because larger guys are closer to the extremes of what the body can do. Some we will never know for sure.

But there is injury data to be had that's pretty cool. I included the link below on a different thread around here a week or two ago and you should go out and look through it. 

Quote

Jon Roegele, a SABR researcher writing for the Hardball Times in 2018, did an article on Tommy John surgery that said 26 percent of major league pitchers used in 2017 had undergone Tommy John surgery.  Today that percentage is 34%, and that's only the most serious elbow work, not shoulder, back, knee or hand injuries. His updated raw data is online here and it's fascinating. He's got every TJ surgery that he can confirm for MLB and MiLB players, including a list of unconfirmed and pending surgeries.  Pitchers break, and break badly, all the time. 

https://docs.google.com/spreadsheets/d/1gQujXQQGOVNaiuwSN680Hq-FDVsCwvN-3AazykOBON0/edit#gid=0

 

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1 hour ago, tarheeltwinsfan said:

Good points River.  Speaking of sleeping during med school, at my last colonoscopy, the doctor walked into the operating room before I was put to sleep. He asked me how I was doing. I said I was doing fine. He proceeded to tell he he had been up all night drinking. I guess that is an old  gastroenterologist joke. 

When I went in for mine one of these was sitting nearby.

Heavy Duty Extension Cord and Reel - 50' - ULINE - S-19880

I was about to ask about it but he asked me to count backwards from a 100... I remember saying wait wait and then I woke up in a different room. 

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3 hours ago, tarheeltwinsfan said:

Good points River.  Speaking of sleeping during med school, at my last colonoscopy, the doctor walked into the operating room before I was put to sleep. He asked me how I was doing. I said I was doing fine. He proceeded to tell he he had been up all night drinking. I guess that is an old  gastroenterologist joke. 

About a year after my first colonoscopy I happened to encounter the gastroenterologist who performed the procedure. I introduced myself and told him how I knew who he was. He said he was sorry that he didn't recognize me because he was not very good at remembering faces. (His emphasis, not mine.) I'm sure that having a sense of humor is helpful if you are a gastroenterologist.

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