MLB Market Data

It has become a common refrain of sportswriters and others to bemoan the fate of small market teams. Their argument, to summarize, is that the financial system of Major League Baseball is fundamentally unequal, and that certain teams possess resources that other teams cannot. I intend to explore this argument through a combination of market and financial data.

Peter Gammons, in his latest blog entry, summarizes the perceived problem of inequality in baseball well:

"It doesn't matter how much luxury tax the Yankees pay or how much Steinbrenner money goes to Kansas City, Minnesota or Tampa Bay. Hank Steinbrenner is going to use his AmEx to win. He gets a year's grace from some of the taxation because of the new stadium that opens in 2009, but if you're out there in a small market, how scary is this winter, with the realization that the Yankees and Mets are both about to open new revenue-cow ballparks?"
(Peter Gammons, "The Rich Get Richer," http://insider.espn.go.com/espn/blog/index?name=gammons_peter subscription required, Accessed 1 December 2007)

Gammons and others argue that teams in the largest markets, defined by them as Boston, Chicago, Los Angeles, and New York have an inherent advantage. Let's look at some data to see how big these markets are relative to others.

The Baseball Almanac has already done an analysis based on 2000 Census Data (Al Streit, "Baseball Markets," Baseball Almanac, http://www.baseball-almanac.com/articles/baseball_markets.shtml , Accessed 1 December 2007)

Unsurprisingly, New York and Los Angeles are far and away the largest markets, followed by:
Chicago, Baltimore/Washington, Oakland/San Francisco, Philadelphia, Boston, Detroit, and Texas (presumably Dallas/Fort Worth).

First, let's update Streit's data with the 2006 population estimates (only MLB markets included):

(U.S. Census, www.census.gov, Accessed 1 December 2007)

Rank	Combined Statistical Area	2006 Population Estimate
1	New York (Mets, Yankees)	21976224
2	Los Angeles (Angels, Dodgers)	17775984
3	Chicago (Cubs, White Sox)	9725317
4	Baltimore/Washington (Nationals, Orioles)	8211213
5	Boston (Red Sox)	7465634
6	Oakland/San Francisco (Athletics, Giants)	7228948
7	Philadelphia (Phillies	6382714
8	Dallas-Ft. Worth (Rangers)	6359758
9	Houston (Astros)	5641077
10	Atlanta (Braves)	5478667
11	Miami (Marlins)	5463857*
12	Detroit (Tigers)	5410014
13	Toronto (Blue Jays)	51131491
14	Phoenix (Diamondbacks)	4039182*
15	Seattle (Mariners)	3876211
16	Minneapolis/St. Paul (Twins)	3502891
17	San Diego (Padres)	2941454*
18	Denver (Rockies)	2927911
19	Cleveland (Indians)	2917801
20	St. Louis (Cardinals)	2858549
21	Tampa Bay (Rays)	2697731*
22	Pittsburgh (Pirates)	2462571
23	Cincinnati (Reds)	2147617
24	Kansas City (Royals)	2034796
25	Milwaukee (Brewers)	1706077

*No Combined Statistical Area defined, so Metropolitan Statistical Area used
1. Census Metropolitan Area data used from Statistics Canada

Some initial observations:
1. There is a massive disparity in market size among the top 8 teams and between the top 8 and other 22 teams.
2. Boston is the largest single team market
3. The Minnesota Twins could best be described as a mid-market team.

I thought it might be useful to divide the dual markets in half so that I could look at a team by team listing. This is obviously very rough, though of course, the home markets themselves are rough (just look at the reach of the Braves, Cardinals, Red Sox, and Yankees). Then, I used the team payroll data from (CBS Sportsline, "MLB Salaries," Accessed 1 December 2007), and divided the amount spent by the number of people in the home market. The results are below:

Rank	Team	Market Size	Payroll	$/person
1	Milwaukee Brewers	1706077	70986500	41.60803
2	Kansas City Royals	2034796	67116500	32.98439
3	Cincinnati Reds	2147617	68904980	32.08439
4	St. Louis Cardinals	2858549	90286823	31.58484
5	Seattle Mariners	3876211	106460833	27.46518
6	San Francisco Giants	3614474	90219056	24.96049
7	Baltimore Orioles	4105606.5	93554808	22.78709
8	Chicago White Sox	4862658.5	108671833	22.34823
9	Oakland Athletics	3614474	79366940	21.95809
10	Cleveland Indians	2917801	61673267	21.13690
11	Chicago Cubs	4862658.5	99670332	20.49709
12	Minnesota Twins	3502891	71439500	20.39444
13	San Diego Padres	2941454	58110567	19.75573
14	Boston Red Sox	7465634	143026214	19.15795
Avg.	Mean Average	4878178.23	82633066.23	19.05252
15	Colorado Rockies	2927911	54424000	18.58800
16	Detroit Tigers	5410014	95180369	17.59337
17	New York Yankees	10988112	189639045	17.25856
18	Toronto Blue Jays	5113149	81942800	16.02590
19	Atlanta Braves	5478667	87290833	15.93286
20	Pittsburgh Pirates	2462571	38537833	15.64943
21	Houston Astros	5641077	87759000	15.55714
22	Philadelphia Phillies	6382714	89428213	14.01100
23	Arizona Diamondbacks	4039182	52067546	12.89062
24	Los Angeles Angels of Anaheim	8887992	109251333	12.29202
25	Los Angeles Dodgers	8887992	108454524	12.20237
26	Texas Rangers	6359758	68318675	10.74234
27	New York Mets	10988112	115231663	10.48694
28	Washington Nationals	4105606.5	37347500	9.09671
29	Tampa Bay Rays	2697731	24123500	8.94214
30	Florida Marlins	5463857	30507000	5.58342

Of course, the value of this data is limited, since it doesn't take into account revenue sharing. My next post will attempt to correlate market/payroll data with revenue sharing. In the meantime, I hope this provides some food for thought.