Understanding the MLB’s Free Agent Compensation

Posted: 23rd November 2009 by Jeffrey Brown in MLB
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The free agency period is now upon us, so we have been hearing lots of talk about Type-A and Type-B free agents and draft pick compensationàand the discussion leaves some people wondering what is all means. For those of you who think you need an abacus to figure it all out, letÆs see if I can help simplify it a little bit for you. For the sake of discussion, letÆs say the Red Sox sign John Lackeyàand letÆs say they lose Jason Bay to the Mariners and sign Jermaine Dye to fill the void left when Bay leaves. The question begs: which teams would get what compensation, and why? (NOTE: all three players mentioned are Type-A free agents) Through collective bargaining, Major League Baseball and the MLBPA have agreed on a statistical formula for ranking free agents in order to determine which ...

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