Why MLB's Playoff Format Promotes Underdog Success

The MLB Division Series matchups started on Monday, with three of the lower seeds from the Wild Card round still around. Given that there continue to be discussions around whether this format will stick around past this season, could that be expected each season?

In short - yes, that would be the norm. Baseball tends to have smaller variances between teams than many other sports, and works out those variances over a 162 game season (normally). When condensed down to three games, there isn’t enough time for those differences to play out. The below table looks at the win probability of each lower seed in one game, and then how that plays out in series of different lengths.

With the exception of the Brewers having to play the Dodgers, all of the lower seeds had at least a 1 in 4 chance to advance; even if the first-round moved to five games, those odds still stay above 20%. This year is clearly different, but in a normal season this means much of the advantage gained through 162 games disappears in a three-game series. That’s especially true since baseball’s structure promotes depth, particularly in pitching, and that can be offset in such a short series.

Those odds in the individual matchups tell a clear story, but it’s even more striking when looking at what that means in terms of how many lower seeds would be expected to advance overall. To analyze that, I ran 1000 simulations of each matchup with the results shown below. Each row represents the percentage of time that at least that many lower seeds would advance.

Playoff Simulations

Roughly half the time, the first-round would have resulted in what we saw this season - at least three of the lower seeds advancing. At some level this is what MLB’s looking for, with an opportunity for more fan bases to experience both the playoffs and playoff success; more importantly for the MLB offices, it should result in more revenue. However, that comes at the detriment of the higher seeds that proved themselves better over the course of the year.

That also leads to one thing that I don’t think MLB has thought through - fewer higher seeds means fewer marketable teams and players later in the playoffs. That’s not surprising given baseball’s inability to market their players well, but could be a huge problem if baseball goes after the short-term gain of more TV money from another round of playoffs. To keep those players around, there is one change I think can be carried over from this season - make the wild-card round three games and have no off days during the series or between that and the LDS. While that increases the amount of time other teams are off, it’s hopefully offset by putting the wild card teams at a bigger pitching disadvantage.

This also leaves the question about what would happen with any increased revenue. As I’ve discussed previously, there’s very little evidence that increased teams in the playoffs would mean more investment in player salaries. The table below backs up the reasoning for this - the incremental gains in the chances of success aren’t enough to encourage owners to spend money.

Instead, this could likely result in decreased spending on players. If you only need to be one of the top 8 teams in your league to make the playoffs, and there aren’t huge differences in the odds of success, then why spend to be one of the best few teams in your league?

Rather than discouraging tanking and encouraging even more investment by the teams in the middle, this likely results in the top teams choosing to spend less since the incremental gains aren’t worth it (especially if approaching the luxury tax). This format would lead to lower player salaries, more high-quality teams being knocked out in a format that doesn’t match the full season, and fewer eyes on the later rounds as marketable teams and players are knocked out.

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