Is Dustin Pedroia's new contract a good deal for the Red Sox?
The Boston Red Sox and second baseman Dustin Pedroia have secured their long-term futures by agreeing to a deal that will pay the diminutive second baseman $110 million over seven years starting in 2015.
According to Ian Browne of MLB.com, the deal was agreed to on Tuesday night and became official after Pedroia passed physical on Wednesday.
Pedroia, unsurprisingly, sounded elated to be staying with the one franchise he has known for what will likely be the rest of his career, telling MLB.com that Boston is his home.
I love being here, I love my teammates, love this city. If it becomes that, I'll be pretty excited. That's really important. The Red Sox drafted me. A lot of teams passed on me because of my size and stuff like that. It's pretty important. That's why I want to make sure I work as hard as I can to make sure that they made the right choice in drafting me and me being here my whole career.
With both sides surely happy with the way things worked out—especially the Red Sox, who get to keep their best all-around player and did so before Robinson Cano blew up the second baseman market in the offseason—it makes you wonder what Pedroia is really worth.
Whenever a player signs a contract like this, both in length and dollars, a lot of things will be said and written about how it will work out for the team in the later years if the player can hold some/most of his value as he gets into the twilight of his career.
So how much was Pedroia actually worth to the Red Sox, and how will his numbers look as he moves into his age 33-36 seasons?
Dustin Pedroia's extension with the Red Sox is...
First, to determine how much of a bargain this deal appears to be for the Red Sox, we have to look at the value Pedroia has already produced. After all, baseball is a sport that works backwards and pays players for what they have done instead of what they will do.
There is no proven scientific method to say how much a given player is worth; it just comes down to how much a team is willing to pay you. However, there are certain methods that have been created to try and put a dollar amount to the value a player adds.
Fangraphs crafted a way to calculate a player's WAR for a season into a dollar figure that would be at least representative of what they could hope to earn on the open market. That seems like as good a place to start as any. Also, to provide a frame of reference, we will put Pedroia's actual salary for his first seven seasons (2007-13) up against the projected salary over the same period of time.
Using a little fast math, Pedroia has been worth approximately $151.3 million on the field to the Red Sox in his career. In the first seven years of his career, Pedroia will have earned approximately $30.1 million.
That means the Red Sox have turned a net profit of $121.2 million from the production that Pedroia has given them since the start of the 2007 season. It's not surprising, since teams always get the better end of the bargain early in a player's career while the reverse is usually true as a player ages (see: Albert Pujols, Alex Rodriguez, Josh Hamilton).
So using that model, you can see why the Red Sox would want to lock Pedroia up. Even if the second baseman provides one-half or one-third of the value he already has, the Red Sox will still come out ahead based on the total money he will have earned through his two big contracts. Remember, Pedroia signed a six-year, $40.5 million deal before the 2009 season.
Stacking Pedroia up against other second basemen in baseball, his past performance certainly falls in line with some of the best the sport has to offer. According to Fangraphs, only Philadelphia's Chase Utley (38.6) ranks ahead of Pedroia (33.3) in wins above replacement since 2007.
Now, that provides the information we need for Pedroia's past, but since contracts cover what a player is going to do, we have to start looking ahead to the value that the Red Sox can expect to get from their All-Star through 2021.
Obviously this is all just guesswork, since so many things can, and often do, tend to happen like injuries a down or outlier season, natural age regression, etc.
First, we want to look at the performance of second basemen in the past once they hit a certain age. Dave Cameron of Fangraphs examined the sharp decline players at that position in March 2013 when discussing the possibilities of a Robinson Cano extension with the Yankees.
Cameron found a sharp contrast in the way that even the best second basemen in baseball played during their age 26-29 seasons (typically the peak years for most players) and how they played once they reached the age of 31 (which is how old Pedroia will be when his extension kicks in).
Just in terms of plate appearances and potential to add WAR, this table shows that second basemen are giving their respective teams just about 67 percent of the total value they did at their peak.
Let's just assume Pedroia follows that path, an average season for him would put his WAR total around 3.2, which was roughly the value that Dan Uggla and Danny Espinosa provided in 2012. That's still good for an everyday player, but it is not in the four-to-five-win territory Pedroia has averaged throughout his career.
That is just one way to determine Pedroia's future value. Another way to do it comes courtesy of Baseball-Reference.com, which uses "similarity scores" to show what a current player is doing against both current and former players whose career path is similar.
The players most similar to Pedroia through his age 28 season (2012) include Jose Vidro, Michael Gehringer, Ray Durham and Michael Young.
Gehringer was a Hall of Fame player whose career extended well into his late 30s. In fact, from 1934-40 (age 31-37 seasons), he never had an on-base percentage under .409.
But following the career trajectory of the other three players, Vidro was done by the age of 33; Durham maintained an above-average OPS+ in seven of the eight seasons he played after turning 31; Young has been inconsistent for the last six seasons, holding no value on defense and putting together a few solid offensive seasons to keep him at league average.
Here are the WAR totals for Durham, Vidro, Gehringer and Young after they turned 31, just to put a solid number on their value added:
You can see just how much of an anomaly Gehringer was, but he was also a much better defender than anyone else on the list and more closely resembles the all-around game that Pedroia provides.
That is not to say Pedroia is going to provide 45 wins above replacement after the age of 31, but there is more hope that he comes closer to that than the numbers put up by Durham and Young.
Cameron also noted that, if you want to find a comparable for Pedroia based on the last three years, you could do a lot worse than Texas second baseman Ian Kinsler.
The Rangers signed Kinsler to a five-year, $85 million contract covering 2013-17 (age 31-35 seasons). That deal is more in average annual value than Pedroia is getting.
The point being that, given where the market is at (and will be after Cano signs his deal this winter), the value Pedroia has already provided to the Red Sox both offensively and defensively, the potential is there for him to hold at least a large portion of that value.
So with all that taken into account, not to mention the fact that his merchandise is going to bring in a lot of revenue for the team, this is one of those rare $100 million contracts that makes a lot of sense for the team.
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