Mets Hire J.P. Ricciardi As Special Assistant To Sandy Alderson

that is, a reasonable financial commitment relative to the player value, then the market would have rushed in to obtain that contract… since the market didn’t rush to obtain that contract it means that it wasn’t enough of a financial value relative to the player value.

If there were no teams that had need or budget availability then again, it means the contract wasn’t as “good” as some are making it seem even if war value indicates otherwise.

if a player at that payroll commitment level is subject to such wild performance fluctuations, that’s another strong indicator of an overpay.

instead of a replacement level season, given the length and amount of his deal, along with its being common knowledge the Jays had to cut payroll, the difference in Toronto’s leverage would have been very slight, on the order of getting all of one decent prospect instead of the nothing they received.

One of the particularly interesting things to me was how significant a roll of the dice picking up Rios—a player entering his decline years who had just come off a replacement level season—was for Kenny Williiams. It’s the kind of move that, if it goes badly, is brutally obviously the GMs fault. There’s really nowhere to hide, no excuses to make. Say Rios simply continued to post numbers like his 2009 season. Williams has then pissed away over $60 million. It’s the kind of move that can go a long way towards getting a guy fired.

Granted, Rios’s .273 BABIP in his lousy year certainly gave any tearm picking up Rios a very promising stat wrt an eventual rebound, but by all accounts Kenny Williams isn’t a GM who looks at that kind of stat. So far, so good, for Chicago, though Rios 2010 wasn’t so sensational that there isn’t still plenty of room for the deal to go sour. Rios is exactly the kind of ballplayer whose career can be over by 33.

In point of fact, take any projection system you like, and Rios’s contract, at the time it was signed, (reworked at arond 7/68 in April 2008) was a perfectly good deal for Toronto. At the time, given the going rate for wins, Rios needed to be only a 2 win player over the life of the contract. From a guy who had just put up a 3.5, then a 5 win season and who played a good CF (meaning he has the cushion of moving down on the defensive spectrum as he grew older), the general view at the time was that the Jays have gotten a very good deal. Someone could argue that Williams should have anticipated the market crashing, but even with that there’s a not insignificant chance that Rios will overperform his contract by 50%.

it extols “better” process, process as close as possible to optimal efficiency

First, there is an assumption that there is some articulable manner of valuing human performance is advance, especially in the context of unique services to be performed by a human being that are highly contingent on relatively unpredictable value inputs such as injury. Basic economic principles such as market valuation work well for fungible goods, like pork bellies or corn. If you think the market is going to go up, you buy corn now, or more likely to rights to future corn now, and sit on it. It’s easy to tell whether your bet worked out later, because the market price is determinable. On the other hand, with a baseball player metrics such as WAR are mere estimates, and often disagree with one another by 10% or more depending on who you ask, and the idea that you can assign a set dollar figure to each game of WAR is subject to all sorts of criticism. The price of corn (assuming you specify the type of corn, its location, delivery method etc.) is not subject to such a large deviation, and you can fairly easily figure out how much corn you need to make X gallons of corn syrup or to feed Y cows for a month. In other words, for baseball, you have a squishy value figure correlated to a squishy analysis of performance, based on pre-deal scouting that is trying to value a human being performing a unique service.

Furthermore, some of the arguments based in economics I see here ignore opportunity cost and the optimization arguments based both on the deal itself and the cohort of possible deals. I see this alluded to a bit by njk237, but the fact is that, semantics notwithstanding, a “good” contract should be as close to “optimal” as possible, understanding the squishy nature of the valuation method described above. “Good” in my mind means not merely below whatever sort of cumulative estimate Fangraphs would assign to the player, but good in context of other opportunities you could have had, both at that position and on the team as a whole. A bet on corn would not be a good deal even if the price goes up, if that increase still lagged behind inflation and simply parking your money in the bank would have created more value via interest. “Good” in this case means at least “better than other available options.” Opportunity cost is likely higher in longer-term deals because it is harder to predict what will be available in the future, and how the money you lock up now will affect your later ability. Omar Minaya and his continuing effect in 2011 is about as good example of opportunity cost as I can think of. It also works in reverse: getting someone on the cheap now means better trade options in the future, thus creating opportunity in the trade market while simultaneously reducing opportunity in the FA market.

I guess my point here is that things like WAR and other metrics, while not bad means of analysis of something that usually defies simpler analysis, do have a tendency to lull folks into a false sense of security. This is common with formulae that allow you to plug in numbers and spit out a seemingly well-thought out result. But to analyze a deal as I would like to see from high-paid businesspeople and baseball quants includes a lot more than simply looking at these numbers. It includes a full predictive array of lost opportunity, true value to the team considering prospects at the position who may be within the system and soon available for cheap, whether the player plays up to his expected potential, and an in-depth analysis of whether value, as assigned by the WAR-creators, fully takes into account how the player fits into the team overall (i.e. if you already have a utility infielder/PH with a decent lefty split and a WAR of 1.5, then another guy with the same attributes might be worse less to you than to others who need to fill that slot, and rather that paying “market” (high bid) for him, your money would be better spent filling other roles).

it was to say tyhat Lowe credits Maddux with helping him greatly.