Analyzing Expected Production from the Major League Baseball Draft: Are Organizations Conducting Inefficient Selection Processes?

Abstract

This paper seeks to discover if there are any inefficiencies in the Major League Baseball draft process and how to apply these conclusions to the modern game. Analysis is performed using the 1965-1995 drafts to test if certain variables – such as latitude and longitude of home states for players selected out of high school, strength of schedule for players selected out of college, and position played at time of draft for both demographics – influence expected player production at the Major League level. Player production is measured using two output variables: Wins Above Replacement (WAR), and Games Played (GP). Ultimately, we conclude through the use of three distinct OLS regressions that latitude and longitude have little effect on the expected production of high school picks; strength of schedule has statistically significant positive correlation with expected production for one group of college players; and position played at time of draft is a significant factor in expected production. These results offer considerable evidence that inefficiency is present in the selection process of both high school and college baseball players, and that Major League organizations could benefit from reassessing antiquated scouting theories by prioritizing certain types of draftees when talent is relatively equal.