Determinants of MLB Win Percentage
Faculty Sponsor(s)
Eric Schuck
Subject Area
Economics
Description
Professional sports are a really good way to look at economic behavior, because teams act like firms that are trying to turn resources into results. In Major League Baseball (MLB), the main goal for every team is simple: win games. But the way teams try to get there can be very different. Some teams spend a lot of money on payroll to bring in top players, while others focus more on efficiency, player development, and analytics.
This leads to a bigger economic question: is success mostly driven by how much money a team spends, or by how efficiently they use their resources? This is important because it applies to how firms operate in general. If spending more money always leads to better outcomes, then larger firms with more resources should always perform better. But if efficiency matters more, it shows that smaller firms can still compete by using their resources more effectively.
MLB also isn’t a perfectly competitive market. There are rules in place, like revenue sharing and the luxury tax, that affect how teams spend money and build their rosters. Because of this, large-market teams have a financial advantage, while small-market teams often have to rely more on efficiency and smart decision-making to stay competitive.
With all of this in mind, the goal of this research project is to figure out which team characteristics actually matter most when it comes to winning games, and whether winning is more about spending money or using resources efficiently.
Recommended Citation
Dennis, Emerson Michael Richmond, "Determinants of MLB Win Percentage" (2026). Linfield University Student Symposium: A Celebration of Scholarship and Creative Achievement. Event. Submission 41.
https://digitalcommons.linfield.edu/symposium/2026/all/41
Determinants of MLB Win Percentage
Professional sports are a really good way to look at economic behavior, because teams act like firms that are trying to turn resources into results. In Major League Baseball (MLB), the main goal for every team is simple: win games. But the way teams try to get there can be very different. Some teams spend a lot of money on payroll to bring in top players, while others focus more on efficiency, player development, and analytics.
This leads to a bigger economic question: is success mostly driven by how much money a team spends, or by how efficiently they use their resources? This is important because it applies to how firms operate in general. If spending more money always leads to better outcomes, then larger firms with more resources should always perform better. But if efficiency matters more, it shows that smaller firms can still compete by using their resources more effectively.
MLB also isn’t a perfectly competitive market. There are rules in place, like revenue sharing and the luxury tax, that affect how teams spend money and build their rosters. Because of this, large-market teams have a financial advantage, while small-market teams often have to rely more on efficiency and smart decision-making to stay competitive.
With all of this in mind, the goal of this research project is to figure out which team characteristics actually matter most when it comes to winning games, and whether winning is more about spending money or using resources efficiently.