Baseball is my favorite sport, but its future looks dim. The share of Americans who identify baseball as their favorite sport in Gallup Polls has slipped to 12% and will continue to fall as the under-35 demographic, which shows below-average interest in baseball, matures. Add to that the effect of immigration trends and baseball could fall to 4th place behind soccer by 2030 when Latinos are projected to constitute over 20% of the US population.
This suggests to me that the game needs to change, and economic principles can help us understand why people are less interested than ever in baseball:
Principle #1: Leisure has a cost, that cost is the wage rate.
Statistically, Americans today enjoy more leisure than ever. For the last 200 years, research shows that average hours worked per week and per year (including vacations) have decreased. In addition, greater wealth and technology has decreased the number of hours worked at home performing household chores. However, we “feel” that we have less leisure than ever because our wages have increased. That is to say that the opportunity cost of enjoying an hour of leisure, and not working, has increased.
This sheds some light on why baseball fans complain about the length of a game disproportionately more now than in the past, even though game lengths have not increased dramatically: the perceived cost of leisure has risen dramatically so we’re more impatient or “snacking” than ever.
Principle #2: Price of a Good Goes Up as Quantity Supplied Goes Down
Basic economics tells us that demand curves slope downwards so the price of a good goes up as quantity supplied goes down. Savvy marketers incorporate this into the mantra that “something can’t be cool unless it’s scarce.” Thus lifestyle brands like Urban Outfitters limit themselves to under 100 stores to avoid the fate of the Gap, which destroyed its “cool factor” and profit margins by over-expanding to over 4000 stores. Monopolists, like Major League Baseball, should maximize profits by supplying a lower quantity of a good than what’s demanded.
Baseball’s Excess Supply Problem and Proposed Solutions
Contrary to what economics should dictate, Major League Baseball, America’s legislated monopolist, continues to supply the largest quantity per team of any sport as measured by regular season games/team x average length/game in hours:
MLB Baseball (source): 462 hours
NBA Basketball (source): 206 hours
NHL Hockey (source): 192 hours
NFL Football (source): 51 hours
Worse for baseball, the distribution of game length is skewed so that there are many more extremely long games, of up to five hours, than short:
- Distribution of Baseball Game Lengths in Minutes
Applying “less is more” to baseball, I suggest the following:
- Shorten the regular season by about 30 games. Never again will we need to agonize through so many games thrown by marginal 5th starters. Moving to a four-man rotation improves quality of play, game speed and scheduling by eliminating poorly attended mid-week matinees. Better pitchers get more outs faster and research shows that every pitch thrown adds about 36 seconds to each game.
- Eliminate the DH, but don’t adopt NL rules. Instead, adopt an 8-man batting order where only fielders, but not pitchers, bat. This is a compromise between the ball-crushing, time-extending DH and the mind-numbingly boring pitcher who produces not only outs but wasted pitches. Opinion is polarized enough between AL and NL rules that a compromise will likely be the only acceptable change to the status quo.
- Return to Two Divisions Per League: baseball’s 1994 re-alignment created a third division in each league. This has created weak Central divisions, whose teams over the last 20 years constitute only 25% of World Series participants despite being 37% of the league, and awkward four-team “mini-divisions” like the AL West.
- Eliminate the “Wild Card” Qualify the 2 divisional winners and the top 2 teams regardless of division.This ensures that the Top 4 teams in each league really do make the playoffs. In 2008 that would have produced an awesome 4-way race between NY, Chicago, Minn and Toronto for the last AL spot.
- Use a “Best of 5″ Playoff Format, with only the World Series as “Best of Seven” This speeds up the playoffs and eliminates the potential for major scheduling lags like we saw this year where one team was done in 3 and the other played 7.
That’s a start.
Yes, there is an apparent hit to revenues from shortening the season by 19% but this will be counter-acted by increased fan interest due to shorter games, better pitching, more teams in contention, better scheduling and more meaningful playoffs. In other words, prices will adjust to quantities and increased demand due to greater quality. Whether prices will increase more than quantity decreases is a difficult empirical question which I hope to tackle later.
But one thing is for sure: these changes to the schedule will do a much better job of speeding up games than efforts to get players to “speed up” their play. Baseball players have millions of dollars at-stake telling them to do everything possible to perform at their best. One of the choices they’ve clearly made is to sometimes slow down, as a hitter might step out of the box to gather thoughts and think about the pitcher’s next move. It will be very difficult to change this behavior, and whatever uncertain benefits are obtained will come at a cost to quality of play. As I’ve discussed, shortening the season has the advantage of actually improving quality.
