Hitters’ Arbitration Salaries

Yesterday, I discussed the model that I developed for MLBTR to predict arbitration salaries. The model uses similar information to that which arbitration panels use to determine salaries, and generates an estimate for players that is very close to the actual salary the players earn. Today, I’ll talk a little bit about the salaries of hitters.

One of the most important determinants of a hitter's salary is playing time. For position players, this comes in the form of plate appearances. While it shouldn't be surprising that back-ups make less than regulars, position players who make it onto the field every day get paid more. For example, Hunter Pence got a $3.4MM raise last year for hitting .282 with 25 HR and 91 RBI, but with 658 PA. Adam LaRoche hit .270 with 25 HR and 85 RBI in 2009, but only got a $2.15MM raise for his 554 PA. This year, we predict Nelson Cruz only managing a $2.1MM raise despite 29 HR and 87 RBI, due to his 513 PA, while we have Hunter Pence getting a $4.2MM raise with 22 HR and 97 RBI, in part due to his excellent 658 PA. Getting onto the field matters to panels, both because you can accumulate bigger counting stat totals and because playing time is just important. Take Pablo Sandoval as another example. He has a career .307 batting average coming into his first year of arbitration, and has averaged over 20 HR per season. Our model projects him for just $3.2MM due to his 466 PA this season. Give him the same career rates of AVG, HR, RBI, and SB but with 650 PA in 2011, and he would get about $4.7MM.

Arbitration isn't fair. The one skill that really gets you paid is power—HR and RBI are far more important than other statistics. Knocking in runs matters, yet scoring them is not too important at all. In fact, once you factor in the AVG and SB that hitters do to put themselves in position to score, the actual runs scored doesn’t seem to matter much at all to arbitration panels. Even AVG and SB, however, pale in importance to almighty HR and RBI. Mike Morse had 95 RBI in the Nationals’ lineup this year, and combined with his .303 AVG and 31 HR, we have him coming in with a solid $3.9MM salary. Baseball-Reference.com estimated in August that Morse would have 50% more RBI if given the same RBI opportunities as Ryan Howard. What would Morse earn with 50% more RBI? Try $4.6MM. That’s $700K the Nationals will save on him simply by putting different guys in front of him in the lineup than the Phillies put in front of Howard.

Position does not seem to matter much either—while catchers certainly get paid a premium for their hard work behind the plate, middle infielders get paid about as well as corner infielders and outfielders. Arbitration, apparently, was built to put smiles on the faces of Mark Teixeira, Prince Fielder and Ryan Howard, who accumulate massive HR/RBI totals in potent lineups, but play easy positions. Quietly skilled players who get on base in front of them and play harder positions get paid far less for their contributions. Shortstop Elvis Andrus, for example, comes in at $2.9MM in our projections. Sabermetricians would estimate that his WAR would be about 20% lower if he produced similarly but played 1B instead of SS. However, his arbitration salary would only be about 2% lower.

You can estimate a player's salary to a certain extent using more accurate estimates of value like WAR, but a more sophisticated model that utilizes the same flawed information that arbitration panels use can pick up on these kinds of inefficiencies. Tomorrow, we’ll discuss how panels decide what to pay pitchers.