Historical economics

[damonrusst]

How accurate are the financial models to the historical period we play in? I started a sim in 1929 and the owners seem to be getting stingier and stingier. I'm in 1934 right now and I just got told I have no $$$ for extensions next season even though our payroll is in the bottom half of the league, we've got an 89 fan interest rating, positive cash flow and a 14 game lead over the American League in August. So we've got to be doing as well as we can financially.

What I'm hoping is the stinginess is because we're right in the middle of the Great Depression and things will pick up after 1939. Can anyone confirm or debunk this for me?

[Raidergoo]

Originally Posted by damonrusst

How accurate are the financial models to the historical period we play in? I started a sim in 1929 and the owners seem to be getting stingier and stingier. I'm in 1934 right now and I just got told I have no $$$ for extensions next season even though our payroll is in the bottom half of the league, we've got an 89 fan interest rating, positive cash flow and a 14 game lead over the American League in August. So we've got to be doing as well as we can financially.

What I'm hoping is the stinginess is because we're right in the middle of the Great Depression and things will pick up after 1939. Can anyone confirm or debunk this for me?

The financial coefficient for each season was developed with the use of an academic website called Measuring Worth. I selected the use of a measure called "relative GDP share".

Since the real US economy was in horrific shape in the 1930's, you will see economic deflation during the Great Depression. There will be false hopes that things are getting better, then the economy will turn awful again.

Then comes World War II.

The US economy comes to life before Pearl Harbor, as it starts to export like mad to the Commonwealth. Starting in 1942, there will be some insane inflation, the likes of which are staggering.

[ctorg]

When I make fictional leagues, I often create my own financial history ahead of time and have the league follow it. I throw in depressions like that because they add a level of challenge.

[thbroman]

Originally Posted by Raidergoo

The financial coefficient for each season was developed with the use of an academic website called Measuring Worth. I selected the use of a measure called "relative GDP share".

Since the real US economy was in horrific shape in the 1930's, you will see economic deflation during the Great Depression. There will be false hopes that things are getting better, then the economy will turn awful again.

Then comes World War II.

The US economy comes to life before Pearl Harbor, as it starts to export like mad to the Commonwealth. Starting in 1942, there will be some insane inflation, the likes of which are staggering.

And will all your players then be drafted? THAT would be a nice historical feature, no?

[Raidergoo]

Originally Posted by thbroman

And will all your players then be drafted? THAT would be a nice historical feature, no?

One day in Jerusalem.

[OldFatGuy]

Originally Posted by ctorg

When I make fictional leagues, I often create my own financial history ahead of time and have the league follow it. I throw in depressions like that because they add a level of challenge.

I tried this is a couple of my test runs where I just simmed games to learn the feel of the game. I edited the financials.txt file and had the average price of a ticket and average attendance fluctuate, sometimes falling. Now I admit I didn't sim enough seasons to be sure, everytime I checked the first season or two after the "slowdown" numbers should've taken effect, I noticed the AI never dropped their ticket prices (although it did seem a drop in attendance occurred, thus resulting in less money)

I'm just curious, does the AI EVER drop its ticket price??? Do ticket prices even affect attendance???? I know in my game my fan interest was down to like 42 and so I dropped my ticket price down significantly and I didn't see a spike in attendance. I'm just curious because I know in BM fan interest and ticket price are directly related, and my habits from there may not be of use here if there is no connection.

[Raidergoo]

Originally Posted by OldFatGuy

Do ticket prices even affect attendance????

Team Financial Report

One of the teams in eMLB dramatically slashed ticked prices, attendance went up 500,000, leading to $5.8 million in additional profit. They also won 20 more games, going from dreadful to below average.

[Le Grande Orange]

I would say OOTP has quite a way to go yet before its financial system can accurately recreate the way MLB's financial situation has changed over the years. Teams in OOTP, for example, have far too little to spend their money on compared to real-world teams: about the only expense they have is player salaries, while real teams have to contend with such expenses as team operations, minor league operations, stadium operations, and general administration, all of which eat up a good chunk of the revenues.

[Curtis]

I would love to see minor league operations and stadium upkeep included as expenses.

That might actually provide a reason for smaller stadiums (if you're only filling 20,000 seats in a 56,000 seat stadium) or going to artificial turf or removing the dome.

You might also want to drop or add one or two minor affiliates. Historically some teams have had smaller or MUCH larger minor league systems than the average.

In some far future version of the game you could even include a promotional department, whose job would be to increase interest in your team outside of the local area. Could you develop the Marlins into 'America's Team'?

[Le Grande Orange]

I agree with most of the above.

Another item is that OOTP doesn't really recreate the proper revenue streams for MLB. In reality, major league team revenues currently come from the following main areas:

• Gate receipts (which includes the take from home games and the club's share of away games)
• Stadium revenue (such things as concessions, luxury suites, in-stadium advertising, parking, stadium naming rights, etc.)
• National media revenue (the money from national broadcasting contracts, which is shared equally between all the teams)
• Local media revenue
• National merchandising and licensing revenue (shared equally between all the teams)
• Local merchadising and licensing revenue

Here's a breakdown of the distribution of MLB's total gross revenues for 2006:

2006 MLB Total Revenue  (in millions of dollars)

Ticket sales                            1,933.0   34.6%
National broadcasts                       935.0   16.8%
Local broadcasts                          837.0   15.0%
Other local revenue*                    1,212.0   21.7%
Other national revenue**                   34.0    0.6%
Domestic merchandising & licensing        207.0    3.7%
International merchandising & licensing   105.0    1.9%
MLB.com                                   317.0    5.7%
-------------------------------------------------------
Total gross operating revenue           5,580.0  100.0%


 *includes luxury suites, sponsorships, advertising

**includes All-Star Game revenue, royalty payments from
  minor leagues, miscellaneous items

[damonrusst]

Thanks for the tip. Hope I can keep the team afloat during the depression. Quite a challenge so far. Just got to make it a few more years.