The Perception and the Market of Star Player Trade Value

On Friday night, when the A’s announced they traded Josh Donaldson for Brett Lawrie and three prospects, the public reaction was swift and harsh. How could Billy Beane trade one of the best players in baseball for so little in return? Did he not even bother calling other teams to let them know that Donaldson was available, since they obviously would have made better offers than this? Why even bother trading Donaldson if this was the best they could do? Even as I made the case for the deal being a reasonable one for the A’s, the popular consensus was that the A’s screwed up.

It all felt very similar. As I read through the reactions, I couldn’t help but feel like we just had this conversation four months ago, when the Rays traded David Price to Detroit for Drew Smyly and Nick Franklin. Price was a true ace, traded for players who were labeled a back-end starter and a utility infielder. Where was the upside? Why was this the best the Rays could do? Had they overplayed their hand, or were they just not smart enough to take a better deal that returned pieces with star potential? Like the Donaldson trade, I felt the deal was reasonable for the Rays, but the public sentiment strongly disagreed.

If we go back a year, the Doug Fister trade elicited the same kind of responses, though I shared in the shock at how little Detroit got back in that trade for a quality pitcher. But our reactions were basically the same, wondering how the Tigers turned a highly valuable asset into a collection of lower-upside role players. Wouldn’t other teams have bid more? How was this the best offer?

Two years ago, it was the Justin Upton trade that caused the public to scratch their heads. Martin Prado and some lesser prospects was not the haul that people were expecting, and even as I thought it made some sense for Arizona, the consensus was that this deal was a debacle for the Diamondbacks. A 25 year old slugger headed into his prime should bring back far more than in return than an above average player and prospects with limited ceilings, right?

Maybe not. As trades of this nature pile up, perhaps we need to consider that it’s not the teams selling the star players who are reading the markets incorrectly, but the public that expects returns above what teams are consistently getting. After all, is it more likely that our perception of a player’s trade value is incorrect, or that Billy Beane, Andrew Friedman, Dave Dombrowski, and Kevin Towers all decided to take inferior offers to what other teams were making?

I don’t want to form an argument around an appeal to authority, and we should not assume that every trade that is made always makes sense for both sides just because the people making the trade have more information than we do. However, it feels like if our default reaction to star player trades is almost always that the seller isn’t getting enough in return, then it’s more likely that our expectations are what is out of whack, and not that every team selling a star player is misreading the market for their player.

So, just to make sure I wasn’t just selectively remembering trade reactions that aligned with this hypothesis, I went through and looked at every trade made in the last five years, starting in the winter of 2009. I isolated trades where the deal was clearly one elite player with significant positive trade value being dealt, rather than deals that included major salary dumps — LAD-BOS deal and the Prince Fielder/Ian Kinsler swap, for instance — or young talent challenge trades, like the Michael Pineda/Jesus Montero trade from several years back. I wanted to find deals that were similar to the Donaldson or Price trades, where there was a clear best-player-in-the-deal, and the buyer was acquiring that by giving up multiple lesser pieces.

From there, I put the deals into one of three categories: whether the public reaction favored the team acquiring the star player, the team selling the star player, or whether it was seen as reasonably fair for both sides. Certainly, this is an unscientific categorization process, as we don’t have good polling data from the period of each trade, so I have to interpret what I remember people’s reactions to each deal, and you may disagree with some of my categorizations. This part is definitely more art than science, but hopefully I’ve captured the general sentiment with some accuracy. Below are the categorizations that I came up with.

Deals favoring the buyer of the star player.

Josh Donaldson to Toronto
Jason Heyward to St. Louis
David Price to Detroit
Doug Fister to Washington
Justin Upton to Atlanta
Mat Latos to Cincinnati
Gio Gonzalez to Washington
Anibal Sanchez to Detroit
Hunter Pence to San Francisco
Cliff Lee to Seattle
Roy Halladay to Philadelphia

Deals favoring the seller of the star player.

Jeff Samardzija to Oakland
Matt Garza to Texas
James Shields to Kansas City
R.A. Dickey to Toronto
Carlos Beltran to San Francisco
Zack Greinke to Anaheim

Deals with no clear consensus.

Jon Lester to Oakland
Matt Garza to Tampa Bay
Adrian Gonzalez to Boston
Cliff Lee to Texas
Zack Greinke to Milwaukee
Hunter Pence to Philadelphia

By my categorizations, that’s 11 trades where the reaction was that the buyer won the deal, six trades where the seller was deemed the winner, and six more where enough people took both sides that I considered them neutral. Again, you can quibble with these categorization if you’d like, but I think it’s going to be tough to create too many scenarios where the public reaction has been even between the buyers and the sellers. Over the last few years, most of the time a team has acquired a frontline player, the public’s reaction has been that the team getting the best player wins the deal, or at least they paid no worse than a fair price for the talent received.

But teams selling star players keep making these trades, and as the Donaldson trade shows, they’re making them while not even under duress. It’s one thing to take the best return you can get for a player who is going to be a free agent in a few months, but many of the deals where the buyer was seen as the clear winner involved multiple years of team control. The teams selling off the star players often did so not because they absolutely had to, but because they thought acquiring multiple lesser pieces — often at significantly reduced salaries, freeing up money to be spent elsewhere as well — would make their team better in the long run.

And yet the public continues to hate these kinds of trades, even as teams continue to make them. Interestingly, the deals that were approved by popular sentiment mostly seemed to involve one high profile young talent coming back: Wil Myers in Tampa Bay, Addison Russell in Chicago, Travis d’Arnaud and Zack Wheeler in New York’s trades. Of the deals where the seller was deemed to have won the trade, only the Matt Garza trade to the Rangers didn’t have a headline prospect going the other direction, but the Cubs got enough quantity for a rental that most agreed that they did quite well for themselves.

Perhaps there’s a trend here. It seems like there may be a public bias towards deals that favor value in compressed packages, whether that’s the team getting the one star Major Leaguer or the one very notable prospect; deals where the return is centered around either a useful current big league player and some lesser prospects — the Donaldson trade, the Price trade, and the Upton trade all fit this mold — or deals where a team goes more for quantity than quality are often rejected by the public.

One potential cause for such a bias could be an inflated sense of replacement level; if you buy into the notion that there is a sea of cheap-and-easy-to-acquire league average players — you shouldn’t believe this, but many people do — then you’d place a low value on guys like Lawrie, Prado, and Smyly, as well as prospects who might project to turn into quality players but have limited star potential. If replacement level was really +2 WAR instead of +0 WAR, then all these deals shipping off a +4 WAR star for a +2 WAR player and stuff would be easy wins for the team landing the big name, because the things they are giving up could be easily replaced.

But there’s no evidence that teams actually believe this is the case. Just in the last month, we’ve seen teams pay significant dollars for Adam LaRoche, Michael Cuddyer, and Billy Butler, all limited upside guys who project as league average performers at best. Last year, we saw guys like Jason Vargas, Omar Infante, Scott Feldman, Bronson Arroyo, and James Loney land pretty decent sized contracts in free agency, and no one is mistaking any of those guys for impact talents.

The market routinely affirms the value of established +2 WAR players, and there’s plenty of evidence that teams are willing to pay for modest short-term upgrades that fill holes despite providing little or no upside. So perhaps we shouldn’t be too surprised that teams are also willing to value those kinds of assets in trades as well, especially with the recent push towards almost every team in baseball trying to win each season. The Red Sox trades last summer were mostly notable for their emphasis on receiving big league talent instead of minor leaguers with future value, but this seems to be a league wide trend, not just a preference in Boston.

Even when teams trade star players, they’re looking to get big league pieces back in return. No one wants to do an Astros-style rebuild anymore, so teams seem to be willing to take less long-term value in trade as long as they also limit the short-term reduction in talent when they move their elite players. There’s no question the A’s could have gotten more prospects in return if they hadn’t also gotten Brett Lawrie back in the deal, but Lawrie’s presence allows them to retool rather than rebuild; the same goes for Drew Smyly in Tampa Bay, and that was Arizona’s goal in acquiring Martin Prado from Atlanta as well.

Whether or not this is a good shift in strategy could certainly be debated, and perhaps teams are overcompensating now, focusing too much on present value when trading away elite players when they might be better off aiming for upside instead. I don’t think I’d agree entirely with that sentiment, but there are merits to the idea of trying to land franchise-type talents any time you trade away a franchise-type big leaguer.

I think we should just consider that not every trade needs to fit that mold, however. Teams are frequently trading away very good Major League players without getting elite young talent in return. If our reaction is almost always that a team making that kind of trade is misreading the market, then in reality, we’re probably the ones misreading the market. There’s more to selling off a star player than just maximizing the upside coming back in a deal, and if we evaluate every trade solely by the perceived upside of the players in the deal, we may very well continue to misread the trade market for star players.