Graduation Year

2016

Date of Submission

4-2016

Document Type

Campus Only Senior Thesis

Degree Name

Bachelor of Arts

Department

Economics

Reader 1

William Lincoln

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© 2016 Theron W. Simpson

Abstract

This study evaluates the relationship between different types of player prospects selected in the Major League Baseball amateur draft and their signing bonuses relative to where in the draft they were selected. In a perfect market differences in prospects’ statistical likelihoods of reaching the major leagues should be reflected in their relative signing bonus. The research reported here found that college players, regardless of position, have a higher likelihood of reaching the major leagues than high school players but this is not reflected in their signing bonus indicating that college players continue to be undervalued in the draft. Outfielders were found to reach the major leagues at a significantly lower rate than other players in other positions but are not penalized financially for the decreased likelihood of reaching the major leagues indicating an overvaluation of outfielders.

Comments

I would like to thank Professor William Lincoln, Ph.D., for his guidance throughout the entire process. This research would not have been made possible without his help and support.

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