Masahiro Tanaka and Prospect Valuation

Masahiro Tanaka was finally posted last week. Now, for the next 25 days or so, he’s going to be the center of the baseball world, for all the reasons Tony talked about this morning, and the month long courting of Tanaka is going to end with him likely signing a deal that costs a similar amount to Shin-Soo Choo or Jacoby Ellsbury. Perhaps more, on an annual average basis, since his deal is likely to be for six seasons instead of seven, and teams will have to pay a $20 million posting fee in addition to the salary they negotiate with Tanaka. My guess is that he ends up at $120 million over six years, so the total cost will be 6/$140M with the posting fee, putting his final bill just slightly behind the 6/$147M that Zack Greinke went for last winter.

It is going to be, by far, the largest contract ever given to a player who has yet to play in the big leagues. Including the posting fee, Daisuke Matsuzaka cost the Red Sox about $100 million, while Yu Darvish cost the Rangers about $110 million. And those deals dwarf all of the contracts given to other international players: Jose Abreu got $68 million this winter after defecting from Cuba. Previously, Hyun-Jin Ryu went for $62 million including the posting fee paid to his Korean team, Yasiel Puig got $42 million (plus some potential arbitration payouts that could raise that number substantially), and Yoenis Cespedes got $36 million over four years. Even going back a few years, we see Aroldis Chapman at $30 million and Leonys Martin at $15 million.

Some of the difference in price is due to the rapid increase in revenues that MLB teams have now versus several years ago, but then again, Jose Abreu just signed a few months ago, and the Rangers had already struck gold on their TV deal when they ponied up for Darvish. Ryu and Puig went to the Dodgers, who apparently had a money-is-no-object mandate for the first year of their new ownership, but in the end, the total cost of having both players under control for six full MLB seasons will be less than a team pays to acquire Tanaka.

Changes to the posting system are a factor in the price escalation, as Tanaka will essentially be a free agent, free to negotiate with any team that wants to negotiate with him. But besides shifting money from the NPB team to the player, I don’t know that the new system really increases the cost of the player that dramatically. Because a significantly larger portion of the total cost of acquiring Tanaka will be counted against the luxury tax under this new system, there is actually an argument to be made that this setup should hold down the bid price, since teams like the Yankees can’t treat an exorbitant posting fee like a de facto tax shelter.

And it doesn’t seem to be a special talent situation, as Tanaka is generally regarded as being a lesser pitcher than Darvish was at the time of his posting. Jim Bowden recently compared Tanaka to an in-his-prime Dan Haren, which is a nice compliment, but during the six year period Bowden referenced, Haren made three all-star teams and never finished higher than fifth in the Cy Young voting. He was an underrated pitcher during that time frame, but he clearly wasn’t viewed as a true #1 starter, the kind of dynamite talent that a team should break the bank for.

And yet, here we are, with Tanaka on the verge of getting paid at approximately the same level as baseball’s best players, even though he’s never played a game in the U.S. By pretty much every outlet’s official definition of the word prospect, Tanaka qualifies as one. He’s going to be ranked on Baseball America’s Top 100 next spring, for instance. He’ll be eligible for the 2014 Rookie of the Year Award. Yes, he’s got significant experience in Japan, but he’s just 25, and Japan’s professional leagues are probably as close to Triple-A competition as they are to Major League competition. While Tanaka projects as a quality pitcher as early as next year, so do several other pitching prospects, and I find the question of what his deal means for their valuation as interesting as I do Tanaka’s.

For reference, after the Rangers signed Yu Darvish, Baseball America rated him as the #4 prospect in baseball. Okay, fine, two of the guys ahead of him were Mike Trout and Bryce Harper, so it was a loaded year for high-end talent, but they also put Matt Moore ahead of Darvish. Here on FanGraphs, Marc Hulet noted that he would have ranked Darvish 8th overall in his Top 100, behind those same three, but also Shelby Miller, Julio Teheran, and Dylan Bundy, so Marc would have had Darvish as his fifth best pitching prospect that year.

Maybe this reveals some overly pro-MILB bias in these rankings, as in retrospect, you’d much rather have Darvish than any of the other pitchers listed, but I think it illustrates the point that these guys are considered to be elite pitching prospects, but not in a class of their own. Tanaka has dominated Japan, but Moore had dominated Triple-A, and even had a brief (and excellent) stint in MLB prior to that ranking. Likewise, Teheran had already reached the show after a brilliant season in Triple-A at age-20. Darvish had more experience, but Moore and Teheran were judged to be pretty similar prospects, and even with the benefit of hindsight, I’m not entirely sure those judgments were incorrect.

And remember, the general consensus is that Darvish was a better prospect two years ago than Tanaka is now. Which leads me to this question: is Tanaka a significantly better prospect, at this point, than Archie Bradley, Taijuan Walker, Mark Appel, Jameson Taillon, or Kyle Zimmer? And even if you prefer Tanaka’s ability to make an impact sooner than later, do we really believe there’s a significant gap between Tanaka and these premium young arms?

Because I’m not sure I think there’s a huge difference in expected future value here, and if we think that those guys are within shouting distance of Tanaka, what does his price say about their value? If Tanaka is worth $120 to $150 million, is it really fair to suggest that a guy like Bradley is worth less than $100 million?

And, for me, this gets even more interesting when you expand it beyond pitchers. Xander Bogaerts, for instance. Already dominated the highest level of the minors. Statistical projections rate him as an above average shortstop right now, with stardom in the not-too-distant-future. Not a pitcher, so health concerns significantly lowered. Can we really argue that a Major League team would prefer Tanaka to Bogaerts, if given the choice at the same price? For me, it’d be a pretty easy pick to take the 21 year old shortstop over the 25 year old starting pitcher, given their track records and pedigrees, so if the market suggests that Tanaka is worth $150 million, is it simultaneously suggesting that Bogaerts — a player with 50 big league plate appearances — is worth something closer to $200 million?

I know that kind of statement is anathema to the concept of “earning” one’s wages, where work is supposed to be performed first and then payment comes after as a reward for the work already accomplished. And, for a good chunk of baseball history, players have been paid based on what they have done, not what they are expected to do. For most of us, I’d suspect, this is the wage model we’re used to. Work hard, get recognized for what we’ve done, get rewarded for that work. Unions essentially codify this method of experiential pay, and often closely tie salary to length of service.

The market value of major league players doesn’t really work that way, however. That market — when a player is either available as a free agent or is offered up for trade by his current organization — is much more of a consumer/product relationship, and in that dynamic, I think we all generally understand that we pay for the product up front and hope to get our money’s worth in performance afterwards. We don’t get to down to the local car dealer, take the newest model for a year long test drive, and then send the salesman a check at the end of the year for a job well done. We decide we need a car, we evaluate the available options, we make the best decision we can, and then we give the salesman an awful lot of money and hope we didn’t screw up. MLB teams do the same thing with players, only on a much larger scale.

Because the purchase price is paid out in wages, it is easy to attach our social norms of an experiential salary structure to MLB, and it certainly does act that way for the first six years of a player’s career, but it’s also important to remember that his value as assigned by the CBA is not a player’s actual value. And what we’re seeing with Tanaka is the expression of the market value of an elite, Major League ready prospect.

This is why I suggested that Pirates outfield prospect Gregory Polanco might be worth something like $90 million in surplus value a few weeks back, and why I think the Royals decision to trade Wil Myers for James Shields was such a big mistake. Or why I thought the idea of including Bogaerts in a deal for Cliff Lee this summer was insane. Yes, these guys are “unproven”, but as Tanaka is making evidently clear, a player’s market value is not based on a proven Major League track record anymore.

The days of paying for past performance are over. With so much at stake, teams can’t simply afford to build rosters by gathering up players who have done it before and hoping they’ll do it again. Past performance matters to the extent that it informs us about what a player will do going forward. Past performance isn’t irrelevant, and a major league track record should give us more certainty about a player’s future than if we don’t have that track record. But teams shouldn’t pay for a player solely based on how long his track record is, or even if it exists.

In retrospect, nearly every major international free agent — or posted player — over the last few years was pretty dramatically underpaid by the market. What we’re about to see with Tanaka isn’t so much irrational exuberance due to a flood of suddenly rich teams; we’re about to see teams pay full freight for expected future performance without an artificial discount due to the lack of Major League experience. Maybe the price is going to end up being too high, and after a brief surge of successes, we’ll mix in a few more Kei Igawas and Dice-Ks to reset the market’s expectations, but this feels like the a market correction that has been overdue for a while.

Paying for what already happened is a sucker’s bet, as by the time a Major League player has accumulated a great track record and becomes eligible for purchase, he’s probably already on a downward slope. In Tanaka, teams see an opportunity to buy a free agent who isn’t expected to immediately get worse. When discussing what kinds of players teams should give up in trade for short term upgrades, let’s remember how much value the market is putting on players on an upwards trend. These guys, not the expensive aging stars of the past, are the most valuable properties in baseball.




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Dave is a co-founder of USSMariner.com and contributes to the Wall Street Journal.


79 Responses to “Masahiro Tanaka and Prospect Valuation”

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  1. Max Powers says:

    “Rated rim” may be the funniest typo ever.

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    • Jason B says:

      My 1988 Donruss Gregg Jeffries “Rated Rim” is worth…

      …25 cents?! Dammit.

      My retirement planning is faring very poorly.

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  2. George says:

    Good article, Dave. After reading the title and the first few paragraphs, I thought you were going to analyze the valuation of the draft pick compensation — the team signing Tanaka have no compensation attached whereas the team signing the domestic free agents like Garza/Jimenez/Santana will have to surrender a pick. I think you’ve done a similar analysis in the past.

    This was a new idea (for me) and very interesting. Thanks for posting.

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    • Aaron Dixon says:

      I liked the article and his unusual comparisons, but the compensation pick only hours to teams which made a qualifying offer, which means garza/Jimenez/santana signings won’t require a pick I believe

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  3. badenjr says:

    Maybe I’m wrong, but this analysis seems like it misses the “prospect” part of the equation. Teams are paying for expected future performance, and the expectation is that these elite prospects will become elite players justifying elite salaries. In reality, there’s a risk that these prospects won’t pan out. Sure, there’s a risk that MLB free agents will turn into pumpkins too, but the risk (I assume) is much greater that prospects will not pan out. Is the belief that the international players are now a surer bet than international talents of yesteryear were? If so, then this market correction makes sense. If not, then we may be seeing teams becoming blinded by a recent run of good international prospect luck that may result in considerable investment in players that never produce anything at all of note.

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    • jtmorgan says:

      Part of the issue is supply and demand. If there were multiple players such as all the top 10 prospects were all available for just cash it would suppress the contracts given to all of them since there is only a finite amount of money available to be given out.

      By basically being a one of a kind way of buying a single elite prospect it inflates the bidding for the contract he will receive.

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      • Phil Livingston says:

        I think you mean quantity supplied and demand. Just as there is a finite amount of money available, there is a finite number of prospects to give the money to. If this example were shown on a graph, Tanaka would be a single point, not the whole line.

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    • Anon21 says:

      “Sure, there’s a risk that MLB free agents will turn into pumpkins too, but the risk (I assume) is much greater that prospects will not pan out.”

      Not so sure your assumption is correct, so long as you limit “prospects” to those with a certain amount of pedigree. I don’t mean to say that you’re wrong, just that it isn’t obvious to me that you’re right.

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  4. _David_ says:

    By this logic, Danny Hultzen’s shoulder is costing the Mariners $100M.

    Wasn’t Danny Haren’s peak borderline HOF? At least by WAR…

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  5. Anon21 says:

    Speaking of Trout and Harper, they’re each going to hit free agency shortly after turning 26 (about two months after for Trout; about two weeks after for Harper). The signing team is going to get a big chunk of prime to go along with (probably) incredible records of MLB performance. Wouldn’t lay odds against Trout breaking the $400 million barrier.

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  6. bjsworld says:

    I’ve been thinking along the same lines now for a few weeks. Everyone has been so pre-occupied with “if” Tanaka would get posted that they haven’t spent enough time thinking about “whether” he is worth the rumored $20M+/AAV deal that he will sign.

    Paying an unproven talent like a superstar is a pretty risk proposal. The guy will need to produce 3+ WAR every year to justify that contract. That puts him in some pretty good company.

    And if Tanaka is worth $20-22M AAV I can’t imagine how high the bidding should be for guys like Trout/Harper/Kershaw. $30M seems like chump change.

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    • Anon21 says:

      I do think Kershaw will be extended. The Dodgers can offer him free-agent prices before he becomes a free agent, so they will, and he’ll take it.

      Harper, on the other hand… Boras takes no prisoners. And he doesn’t do extensions.

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  7. Ben says:

    Given Doug Thorburn’s breakdown of Tanaka’s mechanics this morning on BP, I’m hardly inspired. I’d be curious to hear the pro scouting world’s take on him. Torburn’s not saying Tanaka’s going to break down or anything like that but instead argues Tanaka might not be able to maintain his control.

    “Tanaka does the little things well, such as maintaining a stable glove position and showing an ability to track toward the target after foot strike, but the combination of inconsistent momentum, wavering balance, and drifting posture is a bad omen for Tanaka’s chances of sustaining the walk rates that have distinguished his statistical record in Japan. He has demonstrated the capacity to overcome these obstacles in the past, but because of his mechanical inconsistencies, he might very well struggle to find the same success and make adjustments against patient, powerful major-league hitters.”

    http://www.baseballprospectus.com/article.php?articleid=22480
    (Full article behind the BP paywall)

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    • Slacker George says:

      I’ll post over at BP too, but I’m curious as to why Doug T. thinks Tanaka’s mechanics could lead to worse walk rate in MLB vs. JPL. I can definitely see that Tanaka’s approach would lead to higher walk rate due to improved opponents, though.

      On the other hand, maybe Thorburn would say the same thing about Tanaka had he remained in JPL, in which case I understand his argument.

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  8. Balk says:

    Just like the escalation of free agent salaries – but to an even greater degree – the increase in the amount of money flowing into the international market is symptomatic of the restrictions placed on Rule 4 draft spending.
    Between the league-wide shift in properly valuing younger talent and with the additional revenue available, it’s safe to assume that if teams were able to continue spending unlimited amounts on the amateur draft that those numbers would be skyrocketing. I don’t want to go into the pros and cons of the new system, which you could argue caused more problems than it solved – vice versa – but the fact is that one of the primary means in which teams used money to acquire talent was restricted. Naturally, the other means by which teams can use money to acquire talent – free agency and the international market – are showing the repercussions of that restriction. Tanaka is getting this money more because teams are not able to spend it on amateur talent.
    There’s nothing at all wrong with this article, I was just surprised this wasn’t mentioned. I think it’s as salient as any other shift in valuation that’s going on. Or maybe I missed the point.

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  9. Tim says:

    “if the market suggests that Tanaka is worth $150 million, is it simultaneously suggesting that Bogaerts — a player with 50 big league plate appearances — is worth something closer to $200 million?”

    No, because Tanaka has one thing Bogaerts doesn’t have – he’s a free agent and the supply of those is becoming ever more limited. If all prospects suddenly became free agents each of them would be worth a lot less, including Tanaka.

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    • Daniel says:

      Yeah but only because they would “suddenly” become free agents. If there was no draft (and there had been for a while), then there wouldn’t be as drastic of a flooding of the market that dramatically reduces prices.

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    • bjsworld says:

      Why couldn’t it work this way:

      Red Sox sign Bogaerts to a 7/$80M type deal. They then turn around and trade him for insignificant talent + $100M (or something like that). I don’t think there is anything in the CBA that would prohibit that type of deal. Don’t think anything like this has been done recently and there would be blow back but it should be possible.

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  10. Steve-o says:

    Building a roster through free agency is inefficient, who woulda thunk it. How is this surprising when FOs are locking up young players early. Hell Rizzo got 7 $41 million. If Bogaerts, Walker, or Bradley hit free agency with good numbers in their mid 20s they’d absolutely get $20+ million AAV.

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    • pft says:

      Free agency is an essential building block for roster construction. You also need homegrown talent to subsidize the free agents. One without the other is doomed to fail to produce a consistent winner. Its not an either or choice. You must do both.

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      • TF says:

        You typically need to get the bulk of your production from homegrown talent, then use free agency to fill the gaps in the lineup. Too costly to do it the other way around, unless you are the Yankees.

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        • pft says:

          Red Sox did not get the bulk of their production from homegrown talent in 2013, They had 4 homegrown players in their lineup (including SP) most days. I think 50% is probably at the top end for most competitive teams, especially those with a payroll over 80 million.

          Would be interesting to see a breakdown of home grown talent for each team to see how much of a WAR contribution on a percentage basis each team gets

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      • ankle explosion hr celebration says:

        (unless you’re the Yankees)

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  11. Eminor3rd says:

    “Here on FanGraphs, Marc Hulet noted that he would have ranked Darvish 8th overall in his Top 100, behind those same three, but also Shelby Miller, Julio Teheran, and Dylan Bundy, so Marc would have had Darvish as his fifth best pitching prospect that year.”

    Yeah, but Hulet also just ranked Jose Abreu as like 3rd or 4th in the White Sox SYSTEM this year, lol.

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  12. Butters says:

    You shouldn’t make fun of dwarfs.

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  13. Peter Dinklage says:

    Who gives a toss?

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  14. MAS says:

    What would Haren have been worth today for those six years in which he made three all-star teams? would it have been 6/140? It may have been since usually those large contracts are given out to pitchers on the tail end of their prime.

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    • AB says:

      Perhaps a more interesting question, is what the league would look like if every prospect could suddenly become a free agent. Would we really see a viable model of paying all of these guys $100m +? If that were the case, you’d either have an even more ridiculous lack of parity (with the rich teams being the only ones able to sign these players) or you’d have a league where every single team had at least one albatross contract. While prospect valuation is improving, there are always busts, and I can’t imagine a situation where there weren’t a huge number of bad contracts throughout the majors. Overpays seem to be manageable only in the sense that the current system can allow you to get around it either by being a rich market team and/or simultaneously being able to acquire cheap, cost-controlled surplus value. If the latter disappeared, you’d probably lose the ability to absorb these bad contracts since they’d cripple you for years. I therefore think you’d probably see a system where teams generally avoided these contracts or one where parity was even worse.

      Otherwise you’d have teams forking over much more for 17-18 year-olds, looking to get the value there. At a certain point you reach a level where there is simply not enough information to make a solid valuation of a player. Under this scenario, you’d still have to have a system where teams were able to capture surplus value; just to a far less extent.

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  15. Rockstar Parking says:

    Solid article, except for the idea that the days of paying for past performance are over. Maybe I’m mis-reading, but that would seem to imply that the structure of free agency in general has changed, yet we are still seeing massive contracts given out to players entering their decline phase, or at least will spend a fair portion of their new contracts in their decline phase — including the two mentioned directly in this article (Choo and Ellsbury).

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  16. camuskid says:

    Very enlightening point of view, contracts as assets instead of labor.

    I wonder, might premium pre-draft American or other non-Japanese amateurs choose to play first in Japan instead of through US minor league system as a strategy to hit a big payday more quickly?

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    • AB says:

      Interesting idea, but one would have to assume that a 19 year old American might get very little interest and have to work his way through the Japanese minor leagues himself. If he fails to break in with a club there, he’s probably closed the book on ever playing professionally in the States.

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    • Paul Sorrento says:

      I’m not positive, but I believe that you have to have some amount of service time in the Japanese league prior to posting as well. Premium US talent would still benefit by going through the amateur draft at age 18/19 and developing through the MiLB system. Tanaka does have a track record of excellence at age 25 against approx AAA level talent. It looks like he’s played 7 years in Japan, last year he made $4 million though I cannot find data for previous season’s salaries. If he does sign 6/$120, he will have made about $140 million in salary by age 31. It is a difficult comparison, but US prospects that will have demonstrated an ability to dominate AAA by their early 20’s (as Tanaka did in Japan) will usually go on to make more than $140 million by age 31.

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      • pft says:

        Japanese baseball is thought to be at a higher level than AAA, some call it AAAA. Main difference is Japanese pitchers are pretty abused and have a lot of mileage on their arm before they come over. If an AAA pitcher comes up at age 25 and blows out his arm at age 27 making the minimum no big deal. The Japanese pitcher at that age is in the middle of a 6 yr deal and if you include the posting fee is costing you almost 20 million a year

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    • Nathaniel Dawson says:

      No they don’t. Not even close. Most domestic players (or international amateur players) are barely hitting free agency by the age of 30 or 31. With three years of play being paid near minimum salary, then 3 years somewhere near half of what a free agent makes, they’re not coming anywhere near $140MM. The best of them have a chance to do that, like A-Rod, Harper, or Trout, but those were all players that debuted in their teens, not early twenties.

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      • Paul Sorrento says:

        The question, however, is in regards to premium talent US born players that have demonstrated an ability to crush AAA by their early 20’s. They become eligible for free agency at about age 27-29 and make significant money through arbitration or contracts that run through arbitration and some time after FA eligibility.
        It is true that MOST domestic players will not make a ton of money, just like most Japanese league players don’t end up with MLB contracts. If the premium talent US born players opt to play in Japan it would be a negative financial move.

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  17. wannabe like Arod says:

    “These guys, not the expensive aging stars of the past, are the most valuable properties in baseball.”

    But then again, the market should adjust in that prospects don’t win championships.

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    • TF says:

      Name a World Series team that WASN’T led by home-grown talent?

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      • stew says:

        2004 Red Sox and 2001 Diamondbacks. Since the D-Backs had only existed for four years at the time, they had no other way to assemble a championship-caliber roster.

        Trot Nixon was the only regular even drafted by the Red Sox. The pitching staff had zero home-grown guys. It’s kind of hard to believe, especially with how important home-grown players have been in their two subsequent championships. At the same time though, they weren’t just a team that bought its way to a championship. They had a huge payroll and Manny was a big free agent signing but they had a bunch of low-key signings that turned into major bargains. Millar, Mueller, Bellhorn, Ortiz and Arroyo cost them a total of 6.3 million and produced a total of 14.6 WAR. I also consider trades of non-established young players to be half-homegrown or less players. This included Lowe and Varitek.

        At any rate, it’s an anomaly. Almost every other championship team has been built through a mix of the draft, trades and free agency.

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      • TF says:

        Exactly, stew. The exceptions that prove the rule.

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        • Jason B says:

          “The exceptions that prove the rule.”

          False. Supporting evidence confirms. Contradictory evidence disproves or discredits, always.

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        • TF says:

          It is just a saying, Professor, and surely one you’ve heard before. If you insist on unpacking it, “The fact that the occasional exceptions stand out in contrast to the rest demonstrates that there is some validity to the rule of thumb.”

          Also, while I wouldn’t want to slander either team, they both date back to the steroids decade. It is much harder to build through free agency when players can’t extend their careers that way. In 2013 there were just 12 position players with a 3+ WAR who were alive in 1980. Date that back 10 years and there were 17.

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  18. AB says:

    Great analysis.

    There’s something here that resembles more of the NFL market, where you put so much more value on young players and draft picks because you’re paying for fully or nearly fully-formed players who you didn’t have to put any cost or risk into developing. If you had an industry where somebody else (e.g. universities) was completely developing your future stars, you could essentially take all those hundreds of millions of dollars that go into player development and put them into rookies.

    The question then is why a Japanese player would get so much more than Cuban players in similar circumstances get. Noise in the Cuban leagues has to be a big part of this, with US-Cuba relations making it harder to do adequate first-hand scouting. Most teams seem to put most of their valuation in workouts for interested teams, conducted after the player has defected (which in the case of a player like Puig meant scouting a player who was relatively out of shape after being inactive and having gone through the treacherous ordeal of defecting).

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  19. Matt says:

    This guy better be like an 85% chance to be a #2 starter or better at that price. That’s ridiculous.

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    • pft says:

      He was the best pitcher in AAAA. The risk of course is injury due to his past workload. Daisuke, Nomo , Darvish had 2 decent-very good years after coming over at an early age. Daisuke and Nomo faltered, and we don’t know about Darvish past year 2 yet. So you are rolling the dice. Older pitchers like Kuroda and Iwakuma may be a better bet due to survivor bias, and they have past the injury nexus. But of course, they are in their 30’s and past their prime by the time they come to MLB.

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      • Pitnick says:

        “decent to very good” undersells Darvish quite a bit.

        And while you’re not wrong to say Nomo faltered, I think it’s easy to overlook that he had a nice little career for himself after setting expectations so high in his rookie season. If Tanaka has Nomo’s career (and for whatever it’s worth, Tanaka’s NBL numbers are much better), he’ll amass 16.7 rWAR and 16.8 fWAR over his first 6 seasons. $8.3M per win. Not a steal, but perhaps not a disaster in baseball’s new economics either.

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        • Pitnick says:

          * the per win figure assumes the $140m contract Dave laid out above.

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        • pft says:

          Darvish and Nomo was in the very good camp, Daisuke was decent.

          I agree if Tanaka is another Nomo its not the end of the world. If he is another Daisuke, yes, the world is ending for some team.

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  20. Sidd the editor guy says:

    “Maybe this reveals some overly pro-MILB bias in these rankings, as in retrospect, you’d much rather have Darvish than any of the other pitchers listed, but I think it illustrates the point that these guys are considered to be elite pitching prospects, but not in a class of their own.”

    Dave, with as rabid of a fan following as you have, ever considered leaning on your fan base for some pro bono editing help? That sentence kinda says it all.

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    • Sidd the editor guy says:

      Ddnt mean that as snarky as it looks. Simply, I think there’s a fine internship opportunity here among the Fangraphs community. Call me the matchmaker.

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  21. MGL says:

    I don’t understand this “pay for work already done” or “work expected to be done” dichotomy. In some businesses or vocations you get a contract which pays you “in advance” for work/performance that is expected of you. In others you are an at-will employee, but you are still paid an amount based on your expected performance. If you don’t live up to that performance, you get fired.

    Baseball is exactly the same, except that in most cases, you cannot get fired for a bad performance. The reasons for that are obvious. You can still get fired or suspended if you don’t fulfill the terms of your contract, like showing up for work on time, not using banned substances, etc.

    Since when did baseball “pay for past performance” and what does that even mean?

    Baseball does and always did pay for expected performance. Obviously expected performance is implied by past performance, whether that past performance is in MLB, MiLB, NPB, or college. In baseball as in other businesses, sometimes a person is paid a bonus for past performance even if it is not required.

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  22. kslackey says:

    Look everyone, Dave Cameron found yet another way to mention the Myers/Shields trade. :)

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    • ValueArb says:

      It’s the most awesome example of lost value. KCs future has been nearly crippled, it’s hard to assemble strong teams given their payroll constraints and they gave away the one piece that gave them the best chance at it. Shields is a fine pitcher, but was not worth $100m+ in salary+prospects for 2 years service.

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  23. Grant says:

    It would be interesting to see how much those top end pitching prospects would cost in an open market.

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  24. Just a fan says:

    I would love to see the M’s make another big move but I don’t want to see them tied down on another pitcher. I would rather invest in players after the 2014 season.

    Vote -1 Vote +1

    • TF says:

      I can’t see the Mariners contending in 2014 regardless of what they do right now, but Tanaka can reasonably be expected to contribute for several seasons.

      Vote -1 Vote +1

  25. Leo Walter says:

    As a Pirate fan first,and a MLB fan second,this tells me that I am correct when I am thinking that any one out there advocating the Pirates trade not only either Taillon or Polanco,let alone both of them,is completely insane. And you all know who you are.

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  26. TF says:

    A while back (perhaps in the context of Ellsbury, Lester, and Johan Santana?) I argued that a top prospect is worth in the vicinity of $50M. There are certainly a few busts, even among prospects with top pedigree, but there are also many who exceed that $50M figure. For example, the two top prospects in that discussion have each been worth close to twice that figure. Ellsbury produced 24 WAR and $110M of value for just $20M of salary, while Lester has produced 29 WAR and $130M of value for $30M in compensation.

    Free agency valuations have risen a bit since then, so we might be pushing $100M now? But that figure is already for a top prospect — I can’t see doubling it for Bogaerts. He may have the potential to be a $200M player, but that is by no means a certainty and should not be the expectation.

    That said, compare the five-year projections for Ellsbury and Bradley. Ellsbury is surely the better player (and the better bet) for 2014, but taken over the next six years there is good reason to expect the younger Bradley to end up on top.

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  27. John C says:

    Another point of interest given the current prospect valuation climate, is the amount of money owners save due to control of players. Obviously, teams that build solely through young players save awful lot, but as the market evolves, I wonder what will happen to that strategy?

    My guess is the trend will move from young players allowing teams to buy out their arbitration years and early FA years to becoming a free agent as soon as they are eligible–especially low risk positional players.

    One would also assume such player valuations will work there way to arbitration salaries making it very expensive for teams that rely on young players to hold on to them.

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  28. TF says:

    Can even a position player be considered “low risk”? Looking just at those position players who were 27 in 2010, the top 20 performances (by WAR) included Franklin Gutierrez, Yunel Escobar, Stephen Drew, Russell Martin, Martin Prado, Rickie Weeks, and Grady Sizemore. Rickie Weeks will hit $50M for his career, the result of a long-term deal he signed while he was still good, but some of the others may retire with less than $25M career earnings. It may make economic sense for a player to sell a couple years of free agency to guarantee his future?

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  29. Sunshine Says says:

    Real time YU is seeing $10M per year for his services. Now tell me why any team would pay more for a lesser talent? Maybe the same with cost of living raises but no where near what most are suggesting; 6X20, stupid money regardless of what his home team got.

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    • Simon says:

      Because you can’t buy Yu Darvishes on the open market for $10 million a pop? And his contract was signed under a totally different posting system.

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  30. pepper says:

    This is the crux of my decision this season. top pick in a big dynasty league. Do I want Tanaka or do I take Bradley, Appel or Buxton (if he is in the draft pool)? I know Tanaka has the publicity, but I just need the best guy. Good article

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  31. Dan says:

    the MLBPA has no interest in young players getting paid a fair contract because money going to “prospects” would be money that is taken away from older players (who are the MLBPA membership).

    It’s like that in every pro sport. The current players want to get paid. They don’t want unproven youngsters getting the money that they feel “should” have been theirs even if it would be more “fair” to do it that way.

    I mean if you are a 36 year old FA, you came up through the ranks earning little money and seeing vets get big contracts. Now you are a vet. Wouldn’t seem too fair to you for prospects to start getting paid and for you to not get paid.

    Vote -1 Vote +1

    • pft says:

      When it first came open for discussion after the arbitration hearing Marvin Miller considered pushing for free agency for all. However, he feared the high number of free agents would suppress the market. He made a terrible mistake, and then decided to push for 4 or 5 years. MLB started with 10 years and they settled on 6.

      It is true that in year one with free agency for all the market would have been suppressed for all but the biggest stars. But as time moved on, very quickly younger players and older stars would be tied up with long term deals, the number of free agents would have dwindled.

      One of the unintended consequences was teams now keep many young players in the minors longer to maximize their 6 years surplus value, and preventing players from getting to free agency until their 30’s at the start their decline years.

      I think the MLBPA should push for an age based free agency determinant. Every player passed his age 28 season should have the right to be a free agent. This would have teams bringing up younger players earlier and gives players a chance to negotiate contracts in their peak years. While it would meet with some resistance from the age 30 & higher group, I believe there may be
      as many 20-28 yo so it would be a close vote.

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      • ValueArb says:

        Charlie Finley wanted free agency every year for every player. Marvin Miller refused, fearing the offseason glut of available players would depress salaries.

        Vote -1 Vote +1

  32. MrKnowNothing says:

    1. Tanaka’s contact is not indicative of a prospects value because he’s a rarity. If every top prospect were available, the costs would come down because they’d flood the market. 2. He also has a MUCH greater sample size that teams are comfortable with. If MLB teams let pitching prospects go out and dominate for three years at AAA just for shits and giggles then they could probably increase the value of that prospect – but they don’t bc a big league player is what they want – not a valuable prospect.

    Vote -1 Vote +1

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