Moneyball Theory in Professional Sports: An Analysis of the Football Industry and Market Failure

Abstract: Nowadays, the transfer price of athletes in the sports market is getting higher and higher. Moneyball is a theory that allows professional sports teams to spend a small amount of money but bring a huge boost. Moneyball applies the economic theory of market failure, mainly using two market failures, Information Failure and Monopsony. This article will analyze two professional sports teams that use Moneyball and market failure in football and baseball and describe the advantages and disadvantages of Moneyball and the future use of Moneyball. This paper finds that Moneyball can help many teams buy cost-effective players in today's sports player market. Moneyball can also help teams refine their recruiting analysts, and there are cases where Moneyball can be used in football. To buy the most suitable players with the guarantee that the team will not break the rules. Moneyball needs more teams to apply to determine this theory in the football world.