Major League Baseball: Industry Overview, Key Issues and Forecast

The Cleveland Indians fans have earned the reputation of being extremely dedicated and loyal to their team. According to Rosko (2016), Cleveland Indians’ fan base was ranked in the top 250 in the world. It is no secret that the baseball team has a devoted following, but it does beg the question who are these fans? The followers of the Cleveland Indians’ brand will be segmented into groups based on their demographics and geo-demographics. For the Cleveland Indians, this will entail categorizing consumers into groups based on age, gender, family size, and region.

Since the stadiums are most on the metropolitan areas, the fans from suburbs spend lots of expenditures, money and time, to watch baseball games. They give up the opportunities to do something else rather than watching games. Every year, the Major League Baseball receives more than $2 billion from advertising, sales of tickets and merchandise. And the “New York Yankees” got more revenues than the combinations of the other teams’

Professional baseball players work tirelessly to perfect their craft and deserve to be paid adequately. Another reason the MLBPA chooses to keep a free labor market is that with a more open labor market, team revenues can steadily increase and lead to increased player salaries. A negative side effect of this, however, is that teams can receive and use supplementary party revenues, which can help outbid competitors for top-tier free agents, and raise the cost of a player beyond the means of teams with fewer or no supplementary revenues (Zimbalist 24). Under this circumstance, which is currently the present state of MLB, a salary cap may become a sensible solution. On the other hand, if a salary cap system was in place, teams might be tempted to cheat by underreporting total revenues.

Boom or bust, pro-athlete salaries have soared over the past decades. In the 1920’s, professional athletes were paid a few hundred dollars per game and held off season jobs. In the 1950’s, this changed as television was introduced and broadcasting rights increased player salaries. Now even with salary caps being put into place for some sports, salaries have far outpaced inflation. For instance, the MLB average salary has increased from about $300,000 to 3.2 million since 1985.

Major League Baseball is an organization steeped in tradition and custom. Nothing short of an Executive Order is necessary to alter the rules that govern the sport. While that may be a slight exaggeration, the foundation of the game has remained largely unchanged on the professional level for decades. That said, a recent change in the rules has stirred a bit of controversy among managers, players and fans.

Nelson. "Is Baseball Recession-Proof?" Research in Business and Economics Journal 8 (2013): 1-10.ProQuest. Web. 2 Dec. 2015. The growth and popularity of baseball has been a constant since its beginning. The idea that baseball is "recession-proof" is not a new and unique concept. Consistently game attendance, consumption of Major League Baseball-related products, and ticket sales have all increased yearly. The journal states that "local economic variables generally do not have a statistically significant influence on attendance", therefore cementing the authors' point that baseball is seemingly recession-proof. The authors ran multiple experiments on several different models, all which resulted in consistent findings, economies may lag, and recessions come and go, but baseball remains untouched by economic downfall. Upon closing the article, the authors ponder a new and coming problem, stagnant income growth, coupled with the increase in demand for tickets may drive up price to a point where purchase for the average attendee may become too expensive, which would in turn would break the recession-proof nature of

Twenty-five million dollars made per year. Over one hundred fifty-four thousand dollars made per game. Over forty-seven thousand dollars earned per at bat. Sounds a little ridiculous, does it not? That is what current Texas Ranger shortstop Alex Rodriguez earns to play the game of baseball (azcentral.com). Baseball is a game that children have been playing in schoolyards and fields for the past one hundred years. It may not be a game anymore. On the Major League level it has become a business. This is where the problem starts.

There’s always some people hating on the fact that MLB players are paid millions of dollars, but never have anything to back up how they are overpaid besides saying that it is ridiculous how much their paycheck is. Little do they know, that some of the money comes from fans, ticket sales, endorsements, and how well they perform. There is a lot more that goes into how they EARN that money.

Field is more of an adult oriented ballpark now, but in the future the Rickett

Every sports team/organization operates the same when it comes to salaries some players get paid more than others and salaries fluctuate based on the economy. In the 1920s the average monthly salary for a Negro baseball player was about $230 which is about $2,760 annually. Whereas in the 1920s the average annual salary for a major league player was about $5,000 to $6,000. Then the dreaded 1930s hit the decade of depression. Despite the failing economy baseball was and is America's pastime and is always popular among the people. People would always manage to go see a baseball game every now and then. This would allow for an average annual salary increase of about $1000 from about $5000-$6000 to $7000. It obviously made sense that as the economy is failing salaries would start to decrease. Of course they did Negro baseball players monthly salary went down from $230 to $170. Which would be $2,040 annually about $720 less than the previous

Baseball is an immensely popular American game, known as the "national pastime," played between two teams of nine players each. The basic implements used in the game are a leather-covered ball, wooden bats for hitting the ball, and gloves for catching it. Baseball is played on a large scale in Latin America, Japan, and other places besides the United States, but it is in the United States that it thrives both as a participant's and spectator's sport. It is played at its highest level in the United States and two Canadian cities, where 26 teams make up the American and National Leagues (each with two divisions, East and West). Combined, these leagues are called major-league (professional) baseball.

Any sports one looks at can be classified as a money-making pit. Scouts looking at young talent ready to sign them for a quick buck and then once they stop producing, move on to the next potential talent. Baseball is the sport that is an industry dominated by trying to gain a profit from a region’s juvenile talent (Ruck). Since 1947, when Jackie Robinson broke the color barrier, there has been an increase in Latin American countries represented in MLB. More than a quarter of major league players are from Latin American, with about half of the minor league players being Latino (Ruck). On the opening day of the 2011 season, eighty-six players represented the Dominican Republic alone. That is more than a tenth of major leaguers (Ruck). One would

In the world of major league baseball, Oaklands A's defied the laws of baseball economics. The team spent only $34 million (the 2nd lowest payroll) had won 102 games and lost only 60 in 2001. On top of this, they finished first in their division and made the playoffs.

Because there was a rumor about the owners were hiding profits with some accounting tricks. The burden was heavy on Ahern’s shoulders because his decision would effect the ongoing contracts and negotiations. Major league is consisted of 26 baseball teams. Most of the teams’ annual revenue were between $20 million and $30 million.

Major League Baseball is known as America’s favorite pastime, and MLB teams spend an extensive amount of money in the excess of a billion dollars with the ultimate goal to win the World Series. This learning team’s focus throughout this descriptive statistics paper is the MLB players’ performances, salaries, salary caps, and winning percentages. Though salaries will by no means be a trade for wins, the goal is to use the less experienced players and pay them a lower salary. Research has been done on whether or not player’s salaries and wins are connected.