John Coppolella is in his third season as the Director of Baseball Administration for the Atlanta Braves.  He previously spent seven years with the New York Yankees as the Assistant Director of Pro Scouting and a Baseball Operations Assistant.  A graduate of the University of Notre Dame and a former Student Manager for the Fightin’ Irish football team (editor’s note: Go Blue), he took some time to answer some questions about the salary arbitration process:

Walk us through how the team decides what number to offer in arbitration. How do you put a value on a player, and how do you factor in his service time?

Each player is his own individual case. Within that case and for that player, there is no set formula in terms of how we arrive at a number. Typically, we will look at relevant and recent comparable players with similar statistical performance and service time who ideally would play the same position.

We just settled a case with Jeff Francoeur, and it was difficult, both for our club and his agents, to identify comparable players. Everybody knows it was a difficult 2008 season for Jeff, but he was still a player who had historic bulk statistics (games played/started, plate appearances, hits, runs, RBI, etc) as a first-time arbitration-eligible player. He had also achieved some awards and remains one of our club’s more popular players. Jeff ended up getting paid more than some players who had a better 2008 season but less than some players who had worse career bulk statistics.

How much do you weigh past precedent in formulating the team’s offer?

Past precedent definitely plays a role, but as any agent will tell you, the most relevant contracts signed are the most recent. According to a study by the Associated Press, this year’s group of arbitration-eligible players reportedly earned a record increase of 172 percent. There’s no doubt that salaries escalate more in arbitration than free agency. There are many reasons for this – beyond it being a flawed process – but the biggest, in my opinion, is once you tender a contract to an arbitration-eligible player the power shifts completely to that player and his agent. In free agency, until a player signs, clubs, to a degree, can still determine a player’s salary.

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Obviously.

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Bill James is spot on… sort of. He writes,

In sports, mathematical analysis is old news as applied to baseball, basketball, and football. Statistical research of player performances has now been routinely applied to improve the results of individual teams. But it has not yet been applied to leagues. This unexplored area holds great promise for sports, and sports fans. Rather than beginning with the question “How does a team win?” - the query that has been the basis of all sports research to this point - what if we begin by asking “How does a league succeed?”

In a way, this is very true. While there are still gains to be made in player performance analysis and projection, we certainly have reached a point of diminishing returns. And studying league behavior more closely could bring enormous benefits. [...]

We’re underway.

The data project has begun, and we have a great example of what we’re trying to do. We’ve shared a file that contains all of the Forbes and Financial World estimates for MLB revenues and expenses dating back to 1990. We are working on adding the franchise values estimates to these sheets as well. Check it out here:

http://spreadsheets.google.com/pub?key=pIZaUeVpPjYAV6TWq6haBJg

An enormous thanks to Professor Rod Fort, who is now teaching at the greatest school in the world. The yearly sheets on that file were taken directly from his website, which continues to be an invaluable tool for us.

Now, when you look at that data, we hope you’ll see the same things we do: some very useful information, but with lots of holes (including all of 1998). That’s where you come in. Help us. We want to compile the largest centralized database possible. And we can’t stress enough, this is by the people, for the people. Nothing will be held back, and nobody will ever be charged for its use. But we have a lot of work to do.

If you’re interested in contributing, contact us, we would love to hear from you.

Watch this space. We had the pleasure of sitting down with Nationals manager Manny Acta over the weekend, and we’ll be running the interview Thursday morning. In his first year at the helm in D.C., the Nats won 73 games, far better than expectations. There are few field managers with a better sense of the business off the field, as a well as a natural tact for in-game management.

Okay, so a little brown nosing never hurt anybody. But we would be stunned if you don’t come away as impressed as we were. Make sure to stop by Thursday and read the full interview.

For those of you that had trouble with the RSS link, it is now fixed. So no more excuses. If you haven’t subscribed to Squawking Baseball, do so immediately before your friends find out and shun you.

In other news, we’ve had a fantastic response to the data project idea. It’s been mentioned on top tier sites like Baseball Musings and Baseball Prospectus (thanks, Will), and we’ve had a number of inquiries from people who are interested in helping.

If you want to help, e-mail us, we would love to hear from you. You can also contact sports business maven Maury Brown, who is partnering with us on this project.

Our data collection project has just gained a major ally. The Biz of Baseball, led by founder and president Maury Brown, will be partnering with Squawking Baseball in gathering and distributing baseball’s financial information to the masses.

We are thrilled with this addition. Maury Brown is one of the most respected names in the baseball business field, and his site has quickly become a goliath in this realm.

Hopefully, this will only be the first of many. If you are interested in contributing, e-mail us. We would love to hear from you.

For more information, check out the official Data Project homepage here.

Feedback? Write a comment, or e-mail the author at squawk(AT)squawkingbaseball.com

We’ve gotten a bunch of feedback on our article Why the Bubble Burst (And Will it Happen Again?), particularly on RAS (revenues allocated to salaries). This is the key number for analyzing and forecasting the market for players. It is the context for which every deal is made.

But here’s the problem: the data is limited, somewhat spotty, and a bit inconsistent depending on the source. We did a lot of cross checking, and used multiple outlets that have freely available data: the Lahman database, Rod Fort’s site, Doug Pappas’s site, the USA Today salary database, Forbes’s annual baseball estimates, and others.

We have full revenue and payroll info going back to 1982, but even these figures could likely be improved. And before 1982, there is a lot of mixing and matching being done, with only a few seasons having any available data at all. The simplistic version of what we have so far can be viewed here:

http://spreadsheets.google.com/pub?key=pIZaUeVpPjYAroeA66JPvMQ

So now we’re turning to you, whether you are an author, blogger, fan, accountant, financial analyst, plumber, waiter, man, woman, child… you get my drift. In the spirit of free data and further research, let’s try to build the best database we can. This doesn’t have to involve just salaries and revenues, it could be total player costs, specific sources of revenue, or anything else you, the reader, can think of.

Let’s get it done, and maybe we can open up a new line of research that could completely change the way we analyze our game.

In any capitalistic society, the market is king. What are the trends? Where is it shifting? What is overvalued? What is undervalued? Every executive tries to answer these and other questions, looking to give his or her business an edge. Private citizens face similar challenges. What stock is on the rise? When is the best time to buy a house?

In baseball, like on Wall Street, the market is constantly changing, presenting enormous challenges to those in charge: stay in front of the trends, play the cards right, and, hopefully, stay in contention.

ThatÕs where we come in. We are baseball people first and foremost. Despite tender ages (mostly early to mid-20s), everyone on our staff has experience in a Major League front office, as well as in outside businesses. Some of us also happen to be Wall Street junkies, consistently beating the stock market by staying ahead of the curve. What we hope to create with this blog is an outlet for us, and others, to look at the market for baseball talent with the same kind of thoughtful, diligent outlook.

- The Squawking Baseball Team