What relegation could look like in MLB
A common thought experiment in MLB is that of relegation, the ultimate anti-tank measure. People often throw it around as an excuse to make teams like the Colorado Rockies or the Baltimore Orioles clean up their number. What could that actually look like in MLB?
I spent a lot of time researching this, understanding the economics, the logistics, and hey, we’re in a lockout between players and owners. This is one of the few times this could be implemented, so why not have a semi-serious conversation about it? Let’s go.
How would relegation work for teams, like the Colorado Rockies, to clean up their act?
Although not a complete system, MLB currently operates through a profit-sharing network, where teams keep 52% of their profits and redistribute the rest throughout the league.
So, for example, with this structure in 2018, the remaining 48% of profits were pooled and distributed in 30 ways (3.3% per team). That was $118 million for every MLB team, including the Colorado Rockies.
The first step in determining if relegation is possible is to find a system where owners don’t lose money by allowing these new competitors. Even if they make billions with these teams, they won’t give up millions to let Des Moines, Iowa have a team, even if it means short-term expansion fee perks. It’s all about how much money they could make, not how much money they make.