There are several formulas out there that can be used to estimate a team's "real" record: Pythagorean Formula, Pythagenport, Pythagenpat, etc. Some use run differential and some use a run-to-runs-allowed ratio.
The question is: Which is the most accurate? The least?
Using the Lahman Database, I ran tests of 13 different methods on every team since 1921 (the end of the Dead-Ball era) to find the most accurate way to measure a team's expected record, with 1981 and 1994 excluded for obvious reasons.
The RMSE (root-mean-square-error) in the table is calculated by squaring the error (in this case, the difference of the team's actual wins and expected wins), averaging all of those numbers, then finding the square root of the average.
The formulas for each method are at the end of this article, to save space.
Here are the results.
What's funny is that Clay Davenport, inventor of Pythagenport, denounced his method in favor of Pythagenpat, yet it is in reality the best method when compared to actual record.
Earnshaw Cook may have been the first to create a win-percentage estimator, and the Double Edge method created by Bill James was never actually used, so their finishing near last can both be forgiven.
The Kross method, on the other hand, cannot be, as it was supposedly a precise way to estimate winning percentage.
Using the Pythagenport formula, we can find out teams that have been lucky and unlucky, by comparing their actual wins to expected wins based on Pythagenport.
Because the Angels have won so many close games, their closer gets more save opportunities, and they have won more games than expected. Tampa Bay is also at the bottom for "lucky" teams—and guess what, the Blue Jays should have more wins than them!
W% = X * (R - RA) / G + .5
Where X is for different methods...
Palmer-RPW: 1 / (10 * sqrt(runs per inning))
Tango-RPW: 1 / (RPG / 2 + 5), where RPG = (runs allowed + runs scored)/(games played)
RPW=10 : 0.1
RPW=RPG : 1 / RPG
W% = (RS^x)/(RS^x + RA^x)
Where x is for different methods...
Pythagenport: 1.5 * log(RPG) + .45
Ben V-L: W% = 0.91 * (RS-RA) / (RS+RA) + .5
Soolman: W% = (0.102 * RS - 0.103 * RA) / G + .505
E.Cook: W% = 0.484 * RS / RA
Double Edge: W% = (RS / RA * 2 - 1) / (RS / RA * 2)
Kross: For teams with RS>RA, W% = RS / (2 * RA) , and for teams with RA>RS, W% = 1 - RA / (2 * RS) . I used the first formula for teams with an equal number of runs scored and runs allowed.