Looking at baseball, you’d think the country wasn’t in a recession—clubs are charging exorbitant ticket prices and shelling out tens of millions of dollars on top free agents. Will the bubble ever collapse? Probably not, writes Nate Silver for Esquire. MLB is, after all, a legally protected monopoly. But more importantly, the sport already has taken steps to add a dose of reality its out-of-control pay structure.
Blue-chip free agents like CC Sabathia will always command princely sums—their skills are rare. But baseball has cut contracts on its “upper-middle class.” In 2007, 29 free agents signed contracts worth $5 million to $10 million. But 2008 saw only 11 such signings, and a smaller but significant drop in the $1 million to $5 million category. "The industry, in just a few years, has arguably made up for decades' worth of inefficiencies," writes Silver. "If only the rest of the economy could be so lucky."