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Brooks Hawkins

Mrs. Brown

Dual Enrollment Economics

18 April 2023

Economics in Moneyball

Moneyball is a movie adaptation of the true story of the Oakland A’s in the early 2000’s.

Brad Pitt portrays Billy Beane, the Oakland A’s General Manager. After losing to the Yankee’s

in the playoffs and losing 3 of star players soon after, Beane decides the team needs a new

recruiting strategy. With such a limited budget and many competitive players in the game of

baseball, statistical analysis and smart economics became extremely important in Beane’s new

recruiting tactics. Beane begins to hire no name players for his team. The players he hires are not

very well rounded players, but they are players who can get on base and score runs. By using this

unusual strategy Beane is able to make the Oakland A’s a team worth something in the game of

baseball. The crux of Beane’s strategy was based on economics; the team did not have money

and really needed an revolutionary way of recruiting in order to be competitive in the playoffs

and hopefully win a word series.

Though baseball was becoming a huge payroll sport, the Oakland A’s at this time did not

have the luxury of a large budget for purchasing players. With the shoestring budget Billy Beane

was given, he had to consult expert analyst in order to maximize his profit from the player he

would purchase. Competing teams budgets were tremendously larger than the Oakland A’s

minuscule budget. Because of this fact, Beane could not use traditional methods when recruiting

new players to fill empty spots on his team. If he did he would not be able to afford many players

and would be placing all his faith, and money on one or two players. Working with analyst

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Beane found that larger teams were very inefficient in the way they were valuing players. They

would look at batting averages and runs batted in to determine if a player was highly valued or

not. However, Beane began looking at undervalued players overlooked statistics like odd base

percentage and slugging percentage. These numbers were truly the better indicators of a player’s

ability to score runs and therefore help the team win. Beane found that in normal cases offense

was significantly overvalued in comparison to defense, which was undervalued. Beane would

also trade out players who were becoming very valuable in order to save himself from having to

payout huge payrolls. Though his budget was small Beane was able to assemble a team of

eccentrics that would go on to do very well in games.

Beane’s determination of the value of a player was perhaps the most innovative aspect of

the Moneyball phenomenon. As stated before, Beane would look at undervalued player’s often-

overlooked statistics and determine if a player was an asset to score runs for the Oakland A’s. To

most baseball teams, a highly valued player was one who was respectable at defense and could

stop players from scoring runs, and one who had a high batting average meaning they could hit

the ball. Beane found that in essence the ability to get on base was highly undervalued in the

baseball labor market. By finding players with high on-base percentages, and usually players

who were unwanted by most teams for various reasons such as age, handicap, or reputation,

Beane was able to scout out players who were bargains with high potential. His hypothesis works

much like the stock market does, finding cheap stocks with high potential in order to gain the

most money in the long run is the goal of all who invest in stocks, and to Beane his players were

his stock and ultimately decided how well the team would end up being and in turn decide how

high his own pay check would be.

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The Oakland A’s went on to win several division championships. The Moneyball theory

has now become widely used by many teams in baseball and is also making its way to other

sports like basketball. With the help of statistics Beane was smart and was able to maximize the

economics of his baseball team and create a winning group that ultimately increased in value

together and changed the approach of baseball recuiting to something much more effective in the

long run.