Steroid Use and MLB Policy:the prisoners’ dilemma

Major League Baseball owners and the MLB Players’ Association have reached an agreement that there will be more, and more random, testing for steroid use, and that the penalties for steroid use will be more severe than they have been in the past, though still not as severe as they are for minor leaguers.

I am having trouble figuring out who was (or should have been) on what side of this negotiation. Here are my assumptions:

  • Players on steroids hit the ball harder and farther, which generates more offence and more demand for tickets, viewership, etc., ceteris paribus.
  • Players on steroids have a higher probability of developing medical and health issues in the future.

If these assumptions are correct, I should think the owners would have favoured steroid use (by the players), and the players would have resisted it. And if this is correct, what had been happening was that steroid use was a typical prisoners’ dilemma game. JC at Sabernomics says pretty much the same thing, but much more elegantly, without invoking the prisoners’ dilemma model.

In this instance, the players would be enticed by the owners to take steroids; the enticement would be in the form of incentive clauses, bonuses for HR or SLG milestones, etc. Each player would have an incentive to respond to those bonuses.

As a group, the players would be better off not taking steroids to out-compete each other, but they cannot just say, “Let’s all stop taking steroids.” They need an enforcer to create absolute disincentives for the taking of steroids, and that’s what this new agreement provides.

One player interviewed on a local sports-talk radio station said he doubted the owners would have pushed a steroid ban had it not been for all the negative publicity in the past few months. Possibly that negative publicity means the marginal revenue product of steroids is expected to diminish. If so, the owners are more willing now than they used to be to become the enforcers for a player agreement not to use steroids.

Yes, individual players will still try to find ways around the ban; there are always those who try to find ways to move off-diagonal in the prisoners’ dilemma pay-off matrix. But for the most part, this ban will likely be welcomed by players.

One friend who knows someone who knows someone…. told me that, in actuality, the players never were particularly opposed to a ban on steroids. Their primary opposition to the league’s drug policy was because they wanted the freedom to continue use of recreational drugs (especially marijuana).

The problem with my analysis is that if it is correct, players’ associations in all sports ought to be negotiating for steroid bans, and it is not clear they are. Why not?

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Author: John Palmer

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