[Goose]

The Dodgers, on the other hand, have $154 million committed to 11 players next year and are $66 million over the luxury tax threshold this year, not including the addition of Scherzer or any others.

This unfortunately matters only in so far as they don't have the willingness/ability to spend more money. It appears they haven't yet hit that point. I think this points to the idea that the so-called "salary cap" really isn't. You can spend whatever you wish. It just gets really expensive. That may need to change.

Why?  Although there is a correlation between payroll and win percentage and the probability of making the playoffs, such a correlation is far from determinant.  Using the correlation between payroll and win percentage this season, over a 162 game season, it takes about $8 million per marginal win.  That seems rather expensive.



BC

It may need to change because of human behavior. Fans aren't going to take into account the fact that buying a championships isn't easy. That it is even possible will turn many fans off. Worse still, many teams will agree with my read about the fans and will be driven to spend more than they can afford to stay competitive. That will undermine the financial stability of at least a few teams. Having franchises fold is not a good look. Fortunately, I think MLB is aware of their  own behavior problems and will tweak the luxury tax to the point that there is a such a penalty for exceeding X dollars that nobody can afford it. That isn't to say teams can't get in trouble anyway by overspending. A progressive tax can still cost a lot of money before it becomes prohibitive. However, as long as it appears there is a real limit the "buying a pennant" threat will not be viewed as a serious problem.

[Goose]

The Dodgers, on the other hand, have $154 million committed to 11 players next year and are $66 million over the luxury tax threshold this year, not including the addition of Scherzer or any others.

This unfortunately matters only in so far as they don't have the willingness/ability to spend more money. It appears they haven't yet hit that point. I think this points to the idea that the so-called "salary cap" really isn't. You can spend whatever you wish. It just gets really expensive. That may need to change.

Why?  Although there is a correlation between payroll and win percentage and the probability of making the playoffs, such a correlation is far from determinant.  Using the correlation between payroll and win percentage this season, over a 162 game season, it takes about $8 million per marginal win.  That seems rather expensive.



BC

It may need to change because of human behavior. Fans aren't going to take into account the fact that buying a championships isn't easy. That it is even possible will turn many fans off. Worse still, many teams will agree with my read about the fans and will be driven to spend more than they can afford to stay competitive. That will undermine the financial stability of at least a few teams. Having franchises fold is not a good look. Fortunately, I think MLB is aware of their  own behavior problems and will tweak the luxury tax to the point that there is a such a penalty for exceeding X dollars that nobody can afford it. That isn't to say teams can't get in trouble anyway by overspending. A progressive tax can still cost a lot of money before it becomes prohibitive. However, as long as it appears there is a real limit the "buying a pennant" threat will not be viewed as a serious problem.