Is it Okay for the Front Office to Lie?

Asymmetric information makes baseball interesting. If all teams valued players the same way, then baseball would be little more than a game of luck (reasonable variation from expectations). Instead, teams with innovative management are able to gain an edge over their competitors by developing better models of player valuation.

Gains teams exhibit by possessing more precise knowledge tend to be short term. Recognizing the importance of OBP may have provided the Oakland Athletics with opportunities to exploit market inefficiencies for a few years, but for a number of reasons including: other teams copying their successful tactics, the release of Moneyball (I am not sure how big of an effect this really had. If OBP was actually still undervalued, the As probably would not have allowed Michael Lewis to chronicle their secrets), and their top assistants leaving for other jobs around baseball, the competitive advantage the As received by more accurately valuing OBP quickly evaporated.

Because asymmetric information does not stay asymmetric forever, it is crucial for teams to actively protect their valuation models. This suggests the front office must keep some information from the fans, and at some level even mislead the public. It is likely that at any given time, the front office knows certain players are not very good. However, it may be in the best interest of the team to extol the virtues of those players, even if it misleads the fans as well.

Derek Carty, writing for The Hardball Times, references Paul DePodesta’s blog as a possible source of front office propaganda. In outlining the Padres who might have been traded at the deadline, DePodesta cherry picks stats that, in the absence of other information, make players like Randy Wolf look like they have all-star potential. Carty writes: “Perhaps my favorite quote comes in his discussion of Randy Wolf.
His collective line of 109 innings, 109 hits, 42 walks, and 100 k's is one of the better lines you'll find during this deadline, but his line of 101 innings, 95 hits, 33 walks, and 94 k's (3.48 ERA) without those two starts is even more indicative of the pitcher he has been. In fact, his 12 quality starts ranks 7th in the NL behind Haren, Lincecum, Hudson, Santana, Webb, and Volquez (DePodesta).
Carty recognizes that smart GMs such as Theo Epstein or Billy Bean are unlikely to be swayed by the writings of DePodesta; however, a few GMs such as Ed Wade may actually believe some of what DePodesta writes. To favorably compare Wolf with Haren, Lincecum, Hudson, Santana, Webb, and Volquez, is a useful sales tool to peddle Wolf, but at the same time is misleading.

In this situation, I doubt many Padre fans have a problem with DePodesta attempting to convince others that Wolf is actually a good pitcher. The club was already out of contention at the time of the post, and if a team overvalues Wolf, the Padres, and by extension the fans, can only benefit.

A messier version of a team misleading the public occurs when the team knows they will not be very good, but tries to convince the fans that the team will contend. In this situation, the team stands to benefit from the higher ticket sales that result from positive expectations. Some point to the Padres preseason prediction of 90 wins as unethical manipulation of their customers. Personally, I doubt that the Padres consistently predicted 90 wins for this team. Perhaps a few simulations out of thousands resulted in a 90 win season, but there is no way that was the average result. At the same time, I don’t really have a problem with teams raising the level of expectations. Ticket buyers were never guaranteed a 90 win season. Additionally, the ballpark experience, while better when the team is winning, can still be fun when the team is losing.

Teams, including the Padres, clearly need to protect their player valuation secrets from other teams. To do this, the team is unable to let the fans in on much of the behind the scenes work that goes into constructing the ball club. It is when teams reveal only selective information in order to entice the fans to buy more tickets that an ethical debate can be had. To me, things like trying to convince the fans that the team is going to be good, or to accept higher beer prices for phony reasons, may be justified from a business perspective, and I have a hard time getting too worked up, but others may be more offended.

I know I've been rambling, and don't really have an answer as to when it is okay for a team to mislead its fans, but I am curious what others have to say on the topic...