Competitive Balance Is More Than a Payroll Problem
A few creative ways Major League Baseball can think about competitive balance.
Baseball is back! Spring Training has kicked off and we’re less than a week away from exhibition games. And yet, even with camps well underway and plenty of storylines to cover, the narratives that continue to dominate coverage are payroll inequality and competitive balance.
Major League Baseball famously operates without a salary cap (or floor). Depending on intent, it’s not hard to suggest that the lack of a cap has a major effect on competitive balance — or that it doesn’t matter much at all. Consider that all of the following things are true:
8 of the past 10 World Series Champions carried a top ten payroll.
No champion was lower than the 17th highest payroll.
Only 3 of the past 10 World Series winners finished with a top 5 payroll.
The team with the league’s highest payroll has missed the playoffs in 2 of the last 7 years.
The popular move — at least among the owners — is to adopt a salary cap. That wouldn’t eliminate the spending discrepancy, but it would shrink it, and move baseball to a system that more closely matches the other major sports.
Would a salary cap help level the playing field? That’s hard to say, and even if it would, players aren’t interested in adopting one.
That doesn’t mean there are no options to address competitive balance. Spending is one lever — but it’s hardly the only one that impacts winning. If the league is willing to push past the obvious and get creative, there are other ways to increase parity.
Shorten the Season
One angle that doesn’t seem to get talked about much is the number of games in the season. Major League Baseball has played 162 games in both leagues since 1962. Maybe it’s time to rethink that number.
Theoretically, shortening the season has two benefits to competitive balance. The first is that a shorter season introduces more variance. Baseball already is more unpredictable1 than other sports, with a fair amount of luck involved in who advances to the playoffs with the current schedule. Reducing from 162 games to 150 or so would introduce more chaos and take away some of the advantage of spending at the top of the scale.
We saw an extreme version of this in the 60-game season in 2020. It’s probably not a total coincidence that was the only season in the past ten years that a team with a bottom five payroll played in the World Series2.
The second benefit is that a shorter season could also reduce payroll disparities over time. With fewer games, the league wouldn’t necessarily have to shorten the length of the season — it could simply insert additional off-days. Those off-days would likely fall on weekdays and other off-peak attendance dates, increasing attendance per game3 and shrinking the gap in local revenue totals per club — which could, in turn, narrow spending differences.
Introduce Relegation
In other parts of the world, one of the biggest incentives for teams to put out a competitive product is the threat of relegation. The lowest-performing clubs in most European soccer leagues don’t get to try again next year; they are demoted to a lower division while new teams take their place.
Implementing a system in the United States would be enormously complex, but big picture, it could mitigate tanking strategies, inspire urgency around winning, and introduce additional drama and excitement for fans.
The commissioner has long discussed expansion. Maybe instead of growing to 32 teams at the top level, the league should shrink to 28 and introduce a secondary tier to enable promotion and relegation.
The popularity of a product like the Savannah Bananas — while a vastly different experience — suggests there is space for compelling baseball outside of the traditional MLB structure. And who wouldn’t be captivated by simultaneous races to avoid relegation and earn promotion?
Allow Advances on Revenue Sharing
The main way that MLB currently addresses imbalance among clubs is through revenue sharing. The basic idea is that all 30 clubs contribute a portion of their local revenue to a central fund, and the proceeds are distributed equally — often resulting in large-market clubs providing payments to small-market clubs.
These payments happen on an annual basis. But what if the league introduced flexibility that allowed small-market clubs to use those payments more strategically to push chips in during a particular competitive window via an advance on revenue sharing?
Take the Pittsburgh Pirates. Per FanGraphs, they currently project to be the 12th best team in Major League Baseball in 2026 with a 42% chance to make the playoffs. They also project to have the 22nd highest payroll in the league. Rather than taking their expected annual revenue sharing check this past year, they might have decided to “borrow” from future payments to give themselves a better chance to land a top tier free agent like Kyle Schwarber or Framber Valdez.
The trade deadline also provides an opportunity for small-market clubs to infuse some future capital into their club. This past year, the Milwaukee Brewers had a relatively quiet trade deadline despite being one of the best teams in the National League. Had they been able to inject some future revenue sharing payments into their budget, maybe they would have been bigger players for expensive bats like Josh Naylor, Ryan O’Hearn, or Eugenio Suárez.
With this change, revenue sharing would do more than determine how much support small-market clubs receive. It would allow them to choose when to invest, aligning spending with their best opportunities to win.
Increase Player Limits for Small-Market Clubs
Most of the suggestions to this point would be fairly visible for fans. A more stealth idea is to increase the number of reserve roster spots from 40 to 42 for small-market clubs.
Changing the number of active roster spots — the 26-man roster — would be extremely noticeable and introduce the possibility of unintended consequences that aren’t worth dealing with. But the 40-man roster? Most fans probably don’t really know that it exists. And in-season, because of the 60-day injured list, teams often carry more than 40 players under reserve already.
These extra roster spots probably aren’t worth millions of dollars or tens of wins, but they would give teams additional time for development and in-season depth — particularly important for clubs without the financial flexibility to upgrade their team through the open market. They would also allow for more speculative waiver claims and less concern about pending Rule-5 status in trades.
This past World Series featured heroic performances from Will Klein and Miguel Rojas — two players much closer to player number 40 than player number 1 on the roster. Extending the reserve roster for a portion of clubs could mean the difference in advancing to the playoffs or hoisting a championship trophy.
Implement a Draft for Senior Staff Roles
No one would suggest that staff members affect wins more than players, but the right leaders absolutely make a difference. They assemble rosters, dictate philosophies, build infrastructure, establish culture, and make decisions that affect the outcomes of games and seasons.
So if we care about competitive balance, why do we only regulate player labor?
Enter a draft for senior staff members.
It would be just what it sounds like: a draft designed to distribute key leadership talent and the associated organizational competencies. Teams would have to announce their intention to move on from existing staff members and enter the draft via blind submission by October 1 in a given year, creating a hiring pool. Selection priority could then be determined through similar mechanisms to the amateur talent acquisition system — rewarding clubs with smaller markets or sustained on-field struggles.
In practice, the system would likely be limited to a small number of senior roles (such as Manager, President of Baseball Operations, or General Manager) where compensation and influence are significant enough to justify participation.
Defining eligibility may prove challenging4 given that titles and reporting structures vary widely from club to club. Teams would also likely resist anything that moves away from full autonomy on hiring. There would need to be strong incentives and conviction to outweigh the concerns.
Still, if leadership and decision-making infrastructure contribute meaningfully to long-term success, distributing that talent systematically is another lever the league has to influence competitive balance.
The conversations around competitive balance are getting louder, and they all seem to center around the same topic: payroll.
There aren’t nearly as many pleas for more variance, more optionality, or better leadership, even though those things all have an impact on winning as well.
The ideas above certainly aren’t the only possible ways to address imbalances — but that’s sort of the point. The current rhetoric focuses almost exclusively on one aspect of competitive balance, when in reality there are many other avenues to explore. Once we push past spending as the only option, new possibilities become much easier to imagine.
This article suggests that it would take a best-of-75-series for the better team to win at an 80% clip in Major League Baseball.
Even the 2025 Colorado Rockies — who finished with one of the worst records in the history of MLB — took two of three from the eventual World Series Champion Los Angeles Dodgers over a three-day stretch in August. In small samples, anything is possible!
A likely pushback to shortening the season would be that total revenue would reduce. Hopefully a reduction in games would also make every individual games more valuable and event worthy to the point that attendance and viewership increase enough to offset the quantity loss.
Another important consideration worthy of its own footnote is how diversity would be handled — the league’s current hiring practices contains rules around interviews and promotions.
Allowing advances on revenue sharing is pretty creative. With the right stipulations, it would add deeper strategy from front offices to react on multiple timelines at once.
The 40-man roster expansion idea is interesting too. I could see both that and the revenue sharing advances being tied to payroll in that you can qualify for certain privileges based on your bracket. E.g., if you're bottom third in payroll you can have 42, middle third can have 41, top third have to remain at 40.
Suggestions that reduce revenue will never happen. So less games? DOA.