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Salary Inequality and Performance in Mlb

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Salary Inequality and Performance in MLB Introduction/Overview: This paper will explore the effect of team chemistry on performance in Major League Baseball (MLB). In the 2000s, the Yankees were a team of great individual talent, however, their lack of team unity was noticeable. In the playoffs, when heart, guts, and team chemistry matter greatly, the Yankees fell short and were easily eliminated each year. It wasn’t until 2009, when the Yankees acquired jokester Nick Swisher, prankster AJ Burnett, and fun loving C.C. Sabathia that the chemistry of the team improved drastically. Shaving cream pies to the faces of players who got the game winning hit, and various other team pranks became the norm in the once tense Yankee clubhouse. …show more content…

Lazear and Rosen’s (1981) paper on tournament theory argues that if wages are based on relative productivity, then workers with higher productivity will be rewarded with higher wages. This, in turn, will increase the equilibrium effort and lead to a positive relationship between wage dispersion and productivity. My regressions results will decide which economic theory of wage inequality the data supports. The chart of variables with expected signs of the coefficients is below. The dependent variable is first, followed by the independent variables in alphabetical order. TABLE 1.1 VARIABLES AND EXPECTED SIGNS Name | Description | Expected Sign | W | Team Wins (one season) | | BA | Total team batting average | + | BB | Total team base on balls (walks) pitched | - | CG | Total team complete games thrown | + | E | Total team errors committed | - | ERA | Total team earned run average pitched | - | GINI | Gini coefficient of team salary | - | HR | Total team home runs hit | + | OBP | Total team on-base percentage | + | QS | Total team quality starts thrown | + | R | Total team runs scored | + | SLG | Total team slugging percentage | + | All variables are yearly team totals. The dependent variable, W, represents wins. My regressions will estimate the effects of the following independent variables on wins. The first independent variable is BA, or batting average. It is calculated by

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