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Arbitration by Team Rather than Player

A plea was recently posted on the message board of one of my ottoneu leagues:

To the 4 owners who allocated a total of $9 to my team, keep in mind that it’s strategically sub-optimal to spend more than $1 on a non-contending roster.

Posted by the last place team, this argument seems perfectly logical and in most leagues the chances are the top 2-3 teams will get hit by close to $30 in allocations, while last place teams will be closer to $15-$20 (we’ll confirm this once allocations are done). But in reality this is an overly simplistic way to look at allocations.

Last year, in the original league, the team Gerbils on Speed finished in 10th place with 20 points and then immediately got hammered in arbitration. Definitely broke the pattern talked about in the intro, but with very good reason.

Despite the bad hit in arbitration, the Gerbils improved by 72.5 points this year, cracking 90 and running away with first place. The bad hit in arbitration was not “strategically sub-optimal” in this case. If anything, we should have done more to slow down this formerly cellar-dwelling team.

And now, coming off such a dominating season, there is good chance that fewer dollars get allocated to the Gerbils this year than last. Instead of having a roster filled with low priced talent, as he spent all of 2012 acquiring, he now has a bloated $523 in salary commitments and his supposed best arbitration target – a $7 Matt Harvey – has not had a single dollar allocated to him, as the other owners are waiting to see how he heals.

Now, don’t get me wrong – the Gerbils are still going to be near the top of our league in dollars allocated. And the owner who posted the aforementioned plea is right – putting a ton of money against his team does not make sense. But it is not a simple case of looking at the standings and allocating more at the top and less at the bottom.

You should be more focused on projected standings in 2014. Is there a last place team that spent all of August selling production for potential and is about to go into 2014 with a loaded roster and a ton of cap space to fill in the gaps? That might be the team that deserves your $3 allocation. Did your league champ take the title by packaging any cheap talent to load up on $50 stars? They probably have to blow it up anyway, so why waste your money allocating to them?

While considering 2014 potential, you should also realize that different players have different potential values to different teams. The owner who made the plea for his weak roster owns a $21 Adam Wainwright and the fact is, on a first place team or a last place team, a $21 Waino is a steal. He also has a $7 Alfonso Soriano. Soriano continues to produce and a $7 Soriano is probably undervalued, but I feel very differently about assigning a dollar to him on a team that won’t compete than I do on a potential league champ. By the time this team is ready to fight for the top, Soriano will have gone up to $9 or $11 on his own and will have gone from “post-peak” to “pre-retirement.” There is a good chance assigning a dollar to Soriano on a bad team will never have an impact.

Allocating by team rather than focusing on players is totally reasonable. You should still put your dollars on the most undervalued assets, but there is nothing wrong with targeting owners rather than players. Just don’t get drawn into the trap of giving $3 to each of the top four teams, $1 to each of the bottom three, and $2 to the other five – look at what the teams are likely to do next year and focus your scarce allocation dollars on the teams who will be in a position to win next year, not the ones who won this year.