Ignoring Arbitration in ottoneu

One of the more unique parts of the ottoneu format is the arbitration process. It has a huge impact on the entire off-season (as it should), but far too often owners allow arbitration to cast a shadow on the regular season.

Owners considering acquisitions, particularly via trade, worry about what will happen to the player in the off-season arbitration process, rather than focusing on the player’s immediate value. When you do this, you are just hurting yourself.

Far too often I hear owners saying they would take player X over player Y because Y is going to get hit in arbitration. But in general, the amount a team gets hit by in arbitration is far more closely related to where they finished the season and where they figure to finish next season than any specific set of high-value, low price players.

A quick refresher – every off-season, each owner is given $25 to assign to players on the other teams in their league. They can put up to $3 on each other roster, spread out over up to three players per roster, and must put at least $1 on each roster. In practice, at least in my leagues, the only time a team gets much less than $17 or so added is if the team is just plain awful. There has traditionally been a relatively small spread in how much gets added to each team, with a high correlation between how high you finish in the standings and how much gets allocated to your team.

What this means is that when you add a player likely to get hit in arbitration you are not adding arbitration dollars to your roster, you are mostly moving them around.

An example: Let’s say you have a $10 Kris Bryant and a $5 Dallas Keuchel on your roster, and they are your two best arbitration targets. Your team finished middle of the pack and is primed to be much better next year. You are probably going to get about $28 in arbitration. We’ll assume it will get evenly split between them, so you’ll go from $15 for Bryant/Keuchel to $26 Bryant ($2 increase plus $14 in arbitration) and $21 Keuchel (same), so $46 for the pair.

Now you have a choice – you can trade your $75 Jose Bautista, who you planned to cut after the season anyway, for a $32 Joey Votto or a $15 Nolan Arenado. Now, Votto may well escape arbitration at that price, while Arenado becomes a prime target. The thing is, no matter who you take on, that $28 estimate for how much arbitration hit you’ll take doesn’t change much.

Maybe you get an extra $1 or $2 if you take on Arenado, but even so, your choice is to spend $80 for Votto-Bryant-Keuchel or $65 for Arenado-Bryant-Keuchel.

The implied rule is to take the best value, period. Better value is better. Wether you think the player you are adding is an arbitration target or not, you take the better value.

In all honesty, this should be obvious – if you turn down a $15 Arenado because he might get allocations, you basically have two alternatives. 1) Acquire another $15 player who won’t get allocated to, because he is actually worth only $15. 2) Acquire a player who produces at Arenado’s level, but is already paid $40, so he won’t get allocated to either. When you look at it from that angle, it seems clear – you don’t take a full-priced $15 player or a full-priced $40 player over a $40 player priced at $15.

Having players who are allocation targets is a good thing and it is only a good thing. If two players are on the table, the one who is the allocation target is always the better option (leaving aside position depth issues and whatnot…but even then…).

When you are evaluating trade options, just ignore arbitration – take the best value you can get. If arbitration turns that player into a less-great value, so be it – that just means that other players on your team kept their value.