First Name:
David
Last Name:
Treadaway
Major Department:
Economics (BA)
Thesis Director:
Michael McKee
Date of Thesis:
May 2012
This thesis looks at final offer arbitration and its role in Major League Baseball. The intention of the research was to identify tendencies and patterns among players going to arbitration. In order to do this linear regression models were used. The dependent variables explored were the final salary and the results of the arbitration case. The independent variables were performance metrics. The goal was to estimate the player's marginal revenue product so as to get a better idea of what the player and the team needed to offer in arbitration. With the results a comparison could be made as to what occurred in arbitration cases that might differ from these expected results. After evaluation it can be seen that power hitters and starting pitchers get the most money from cases, yet there is no pattern for the case outcome. This suggests no over assessment of ability in arbitration cases.