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What is the Marginal Physical Product of Steroids?

Until 1994, the slugging percentage in MLB averaged well under 400. There were some years in which the SLG for the league as a whole went above 400, but those years were rare.

From 1994 - 2003, the slugging average was often above 420 and was always above 400. I haven't performed a Chow Test on the time series of data to see if the jump was statistically significant; it sure looks significant though. Quite possibly not all the increase was due to the use of steroids by the batters. After all, players have gotten bigger and stronger through better conditioning; expansion probably played a role, too. And don't forget that the baseballs were allegedly wound tighter sometime in the late 1980s or early 1990s [and an earlier rise in the league SLG was likely due to the advent of the designated hitter rule].

But now, with recent revelations about Barry Bonds' alleged steroid use, with the new MLB drug-testing policy, and most recently Jose Canseco's tell-all book, it looks as if the use of steroids will probably drop off some over the next few years. The questions raised in this economist's mind are:

  1. How much will steroid use decline?
  2. What will be the impact of the decline in steroid use on power-hitting in MLB?

Let's see what happens over the next few years if, indeed, MLB makes sure players don't use steroids in the future. Will MLB slugging averages revert to around 400? If so, does that mean the marginal physical product of steroids was that it would, on average, add between 5% and 10% to a player's slugging average? Or has the effect of steroids been distributed unevenly among the players, with some receiving a much bigger SLG lift than others?

This latter possibility makes sense. If labour is typically more productive when it has more capital to work with, surely steroids should also be more productive when they have certain genetic characteristics to work with. [As an example, steroids would not raise my SLG at all.]

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