How is Inflation Distributed?

Eugene Freedman and I are both experienced Rotisserie owners in long-term keeper leagues. His theory on inflation is that:

...in keeper leagues is that inflation is normally distributed throughout the auction, but disproportionally distributed to the top players and the scarcer statistics.

In more established leagues where most of the owners are in Stage 3, there are few over bids.

I decided to take a look at my established A.L.-only league to see if Eugene's theory is true for all leagues, or if there is variance from league to league:

Round by Round Inflation

Billy Almon Brown Graduate 2006-2008

	'06	'07	'08
Round 1	+10	-20	-22
Round 2	-11	-7	-7
Round 3	-13	-10	-9
Round 4	-13	-19	-6
Round 5	-13	-13	-7
Round 6	+5	-21	+6
Round 7	+13	-5	+14
Round 8	-3	+7	-21
Round 9	+3	+7	-9
Round 10	+5	+20	+3
Round 11	+21	+13	-2
Round 12	+12	+18	+28
Round 13+	+8	+13	+17

In two of my league's most recent auctions, this was exactly the case. In 2007 and 2008, teams were itching to spend their money, and took the biggest or second biggest perceived loss (actual price versus projected inflation price) in the first round of the auction.

However, there isn't a linear distribution from year to year. 2007 was a race to overspend from Rounds 1-6, with the minuses getting as high as -104 three players into Round 8, before the room inevitably corrected course and the bargains started coming. 2008 saw a much less radical peak at -64, which actually happened three times: in Rounds 9, 10, and 11. 2006 was slightly less radical, with a -60 reached in Round 6 before the auction reached the point where it started searching for bargains.

Since there isn't a rule in most leagues saying that the most expensive players have to be nominated at the beginning, sometimes the round-by-round data don't tell us everything. Here is another way of looking at it.

Billy Almon Brown Graduate 2006-2008 by Price Brackets

Inflation Par $	Proj. Value	Salary	+$4	-$4
$40+ (10)	$432	$426	1	0
$35-39 (14)	$523	$509	2	1
$30-34 (23)	$724	$719	0	1
$25-29 (23)	$619	$630	2	4
$20-24 (24)	$520	$540	1	2
$15-19 (49)	$861	$864	8	8
$10-14 (53)	$656	$640	6	8
$5-9 (109)	$738	$731	24	23
$1-4 (182)	$352	$381	0	12

Looking at the data this way tells a different story. A lot of the overbidding starts in the $15-19 range, and really gets crazy when you start dipping into the $5-9 players. This is where a lot of the bargains are as well, though.

What is happening here? Why isn't the inflation seeping mostly to the top, like Eugene suggests?

There are a few reasons. Primarily, though, there is a ceiling on what players can earn, and my league doesn't want to take any more of a loss than it has to when it is already paying 20% over the player's non-inflation price. This doesn't mean that the league is getting any significant bargains in the $30+ range. Only three players out of the 47 who are projected to cost $30 or more fall into that +4 or better sweet spot; most of the expensive players are more or less paid what we'd expect them to be paid.

The variance comes at the bottom for two reasons:

1. This is where we have the biggest difference of opinion on what players will do. If I ask 10 owners what you should pay for Roy Halladay in a 2009 A.L.-only league, I'm going to get 10 very similar answers. Ask those same 10 owners what you should pay for Armando Galarraga, and you might get a $5-7 difference of opinion. When Galarraga sails past my price, I'll think he's too expensive. But my opponent might think he's a steal.
2. This is the last chance in the auction to express your opinion. An owner who has $20 left to spend on a hitter and three pitchers might be satisfied with his pitching but want to add the best bet he can in the auction. He'll fill in with three $1 middle relievers and pay $17 for a hitter whose inflation par price is $9. He knows he's overspending...but it doesn't matter to him, since he's buying the best player on the board no matter what the price.

It's not a good idea to go into an experienced auction looking for bargains. When they do come, they'll come toward the end of the auction, but spending $2 to get a $6-8 player isn't going to win you your league unless you've allocated your money correctly earlier in the day. Take the bargains when they come, but recognize the fact that you're going to be spending much closer to par before you get to that point.