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Major league baseball (”MLB”) teams over the past 13 years, since the league expanded to its current 30 team format, have been able to spend their way to success in the win column.  Payroll and team win data has shown that the more money a team is willing to spend in a given year, the more wins they are likely to attain that season.

Over the course of the past 13 seasons, we see that the American League has in fact spent more money on their payroll than the National League and that has equated to more wins.  The graph below shows this data:

We can also look at a scatterplot graph of teams in MLB over these past 13 years to see the same story. The data represented in this graph is 13 year averages for payroll and wins for each MLB team, each team represented by a blue data point. The graph shows that the teams that do spend more in payroll on average do have more average wins:

Interesting side stories are also found in this graph, like which teams are most efficient with their money – take the Oakland A’s for instance. They are consistently one of the teams that spends the least amount of money, but does win anyway. Looking at the RedSox and the Braves also shows two teams that basically have won the same amount, but the RedSox have spent almost $25 million more. This graph really speaks to the effectiveness of the front offices of MLB teams, which I think is really interesting.

In the end though, as the data shows, more money spent equals more success in MLB.