You raise several tangents and I'll only try to address the three I bolded. I don't think we really know what forecasting the teams use, except to speculate that the kinds of sabrmetric forecasts developed 20 years ago (back when baseball front offices were mostly pooh poohing the business school quants) probably were a starting point, but they've gone in different directions by now and have left the amateurs in the dust - the heavy hitters in the world of business analytics have gotten pretty good at teasing out patterns from so-called Big Data. Occasionally team personnel take part in things like the SABR Analytics Conference (there's one coming up in March, not too late to buy a plane ticket to Phoenix!) but I've never attended one and I don't know what they choose to say there but I bet it's not very much they consider a competitive advantage. Second, I doubt they use one of the WAR variants literally, even if WAR is conceived in the desired spirit of "value added to the team". For one thing, I'm sure we all agree, in deciding on a contract offer it always comes down ultimately to dollars and cents. A team's winning record contributes fuzzily to revenue in ways they surely can model, and individual players in turn contribute fuzzily to winning in ways the teams also model. But in addition, big-ticket players can contribute to revenue a little more directly, such as concessions sales (might Darvish bring in $1M in sales of jerseys shipped to Japan during several years for example?) or simply name-recognition putting fannies in the seats. Just being seen as "going for it" may be quantifiable for revenue as well - which I think several posters here are suggesting as a reason to pull the trigger on a big contract now. The idea of dollars divided by WAR is just a proxy for the real computations the teams make, and I don't think anyone was pretending otherwise. Third, I am guessing that the free agent logjam is indeed an outcome of an adjustment, but not quite straightforwardly. It may be that the forecasts several years ago were inaccurate, but the inaccuracy was apparently skewed toward the overly optimistic side, and not merely random with bad outcomes generally balanced by surprises on the good side. It looks like teams were paying more for wins, in practice, than they believed going in - if that's a circular argument, so be it, because I can't know what goes on inside GMs minds. OTOH, they were easily affording these dollars. Empirically they WERE paying recent free agents $10M per win, or thereabouts; their perhaps not believing it beforehand doesn't make it untrue. So they CAN pay that price per win, if they choose to, and it's a matter of sharpening up their forecasts (which, in the years that have followed, they probably have) to get more wins for their dollar. That in turn perhaps leads them to spread the money around a little more evenly, which in turn disappoints the top-end free agents who keep waiting for the "real" offers to finally start rolling in this off-season. There's a lot to think about, when trying to reverse-engineer what's going on in baseball's front offices.