Economics of Baseball: 2010 in multi-year deals for free agent position players

The multi-year deal for a free agent position player on the 2010 market was fairly efficient according to baseballprojection.com's free agent tracker--wins went for about $3.9 million. Though it was only about half as efficient as the market for position players on 1-year deals, baseball teams saw a better return here than they did on pitchers--both those that signed 1-year and multi-year deals.

Though the quality of the free agent is generally thought to dictate the length of the contract, the multi-year deal recipients fared only slightly better (1.98 fWAR/player vs. 1.74 fWAR/player). The average annual value of their contracts was more than twice as high ($7.73 million mean) as the salaries of the 1-year deal players ($3.53 million mean), reinforcing the idea that the most efficient FA market is the one for position players on 1-year deals. It should be noted that the (multi-year) group collectively underperformed their CHONE projection.

A look at some of the contracts below.

The best:

Marlon Byrd -- Byrd inked a 3-year, $15 million deal with the Chicago Cubs last offseason. Though he'd only played 140+ games once in his 8-year career and 125+ games twice--once in 2003, once in 2009--Byrd played more than ever in the first year of his new deal. He got into 152 games and racked up 630 plate appearances. Generally viewed as a second-division starter by outsiders, Byrd played plus defense, hit .293/.346/.429, and provided 4.1 fWAR. We can expect some hit-luck induced regression going forward, but the Cubs should be happy to have him at $5 million the next two seasons regardless.

Matt Holliday -- Matt Holliday was the best player on the free agent market last winter and cashed in with a 7-year, $120 million contract from St. Louis. He continued to be an awesome hitter (.312/.390/.532) and played as much as he has since 2007--the year he finished 2nd in MVP voting--providing the Cardinals with 6.9 fWAR. Some things went wrong in St. Louis in 2010 and they didn't make the playoffs, but Matt Holliday's play wasn't one of them. So long as he ages normally, inflation shouldn't surpass Holliday's production.

Placido Polanco -- Placido Polanco was roughly as good with the bat in 2010 as he was in 2009, but 2010 was a tougher run environment for hitters, making the production more valuable. Polanco excelled with the glove at third base in 2010, too, filling the void left by the departure of Pedro Feliz (covered in the 1-year deals piece). He will be 35 years old in 2011, but at only $12 million over the next two years, the Phillies shouldn't have to worry about this contract going forward.

The worst:

Jason Bay -- Bay had a bad, injury-plagued year. He's a player who provides value almost exclusively with his bat (career dWAR -6.6, career oWAR 25.5) and he didn't hit too well--.259/.347/.402 to be exact. Bay is a good bet to rebound and be of more use, but the contract looked a bit unfavorable when it was signed and looks even more so now.

Mike Cameron -- Like Bay, Cameron dealt with injuries all year. Unlike Bay, he was only able to play 48 games and wasn't particularly useful when he played, accumulating -0.3 fWAR. The Red Sox have the financial resources to move on from a mild mistake, and they'll try to recover some of their losses in 2011 by using Mike Cameron as their 4th outfielder if he isn't traded before then.

Mark DeRosa -- I had forgotten about DeRosa. Also injured, DeRosa appeared in only 26 games and hit only .194/.279/.258 in the 104 PA's he was given. His poor offensive production was somewhat mitigated by his adversity and (admittedly small) defensive value, but cost the Giants about a third of a win anyway. Thankfully they more than made up for it in the 1-year position player market.

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