Yeah, we actually do spend our real money on FAAB. There actually is a limit - $350 - but most people are well under $100 spent. So the real limit ends up being your own pocketbook.I haven't played in a league with in-season fees in years. The "regular" A.L. I'm in used to have in-season fees for transactions but we did away with those a few years ago.
The advantage of getting rid of the fees seems obvious. Teams that were out of the running weren't going to plunk down $8 for a free agent who almost definitely wasn't going to be a keep the following year. The unintended consequence of this was that it allowed teams in the middle of the standings in a category to move up during attrition. This seemed to award mediocrity. It also increased league turnover, since teams that weren't making moves weren't paying attention, were more likely to lose interest, and thus more likely to disappear over the winter.
We've found that moving to a flat fee has indeed eliminated most of these issues. With the exception of one habitual offender, most of our league is active all year long whether they're in the money or not. Teams out of the running aren't simply picking up players for the sake of doing so but rather are trying to improve their teams for the following season. This results in more educated owners who aren't simply rolling out of bed on March 15 like they're Leonard and trying to discern what's going on from their tattoos.
I imagine that a FAAB system that relied on real money would work the same way. Owners at the bottom would probably be discouraged from sinking money into their team; why would anyone want to put real money into the kitty for other teams? I can remember spending $8 once on a catcher in the last week of the season who didn't get any AB. But I won the league that year, so I had only "given" $4 away. If I had been in 9th place, I wouldn't have made that move.
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