Top 10 hitting prospects have an expected 6-year WARP of 23.1, while those ranked #11-#25 are at 18.0. Top 10 pitching prospects have an expected 6-year WARP of 12.9, while those ranked #11-#25 are at 11.2.
The most innovative thought in Wang's analysis is to calculate how much salary a team saves by keeping a prospect, over what the team would spend to get the same WARP from a free agent. That salary savings can be used to then purchase or develop another player.
For example, a Top 10 hitting prospect can be expected to produce a 6-year WARP of 23.1 at a cost of approximately $2.0 million per year. The same free agent would cost about $8.8 million per year. The savings of $6.8 million could be used to purchase a free agent who would provide another 18.28 in WARP. Therefore the prospect is worth at least 42 WARP, and any trade in which that prospect is shipped to another team requires that the "selling" team get at least 42 WARP in return over the next 6 years to break even. (Again, these are figures from my spreadsheet using what I interpret Wang's methodology to be. They differ slightly from those reported in his tables.)
It works out something like this:
1. A top 10 hitting prospect is odds-on to be a contributor, and the money saved by keeping him and getting a free agent nets you another contributor. If you trade the prospect, you trade two contributors. You have to get a star in return.
2. An 11-25 hitting prospect is odds-on to be a minor contributor, and the money saved by keeping him and getting a free agent nets you another minor contributor. If you trade the prospect, you trade two minor contributors. You have to get an everyday player in return.
3. A top 10 pitching prospect is odds-on to be a minor contributor, and the money saved by keeping him and getting a free agent nets you a fairly useless pitcher. If you trade the prospect, you trade a minor contributor and a bust. You have to get a contributor in return.
4. An 11-25 pitching prospect is odds-on to be a bust, and the money saved by keeping him and getting a free agent nets you another fairly useless pitcher. If you trade the prospect, you trade two busts. You still have to get a contributor in return.
That's the concept I want to apply to the Santana deal.
(continued in Part III)
