Maybe the widespread discussion of VORP and WAR have straightened this one out, but once upon a time there was a lot of chatter about the Replacement Player when it came to fantasy baseball dollar values.
The basic idea then and now is that each player has a value based on how much better he is than a player who can be obtained for free. That is, the best available player who hasn’t been rostered. The Replacement Player.
When figuring out dollar values it is tempting and a mistake to figure out the replacement value in each category. Rank the Top 168 hitters in each league in HR and the replacement value for homers is four. Rank the Top 108 pitchers in each league and the replacement value for strikeouts is 63. And so on and on. It seems logical and a tempting solution, but it is wrong.
Consider that when so valued the replacement pitcher would have four wins, 63 strikeouts, no saves, with 70 innings of a 3.38 ERA or 200 innings of a 3.71, and a 1.27 WHIP. But that’s a valuable pitcher, an idealized version of the replacement pitcher, a more valuable pitcher than the replacement pitcher.
The proper method for determining replacement level is to value all players in each category (in whatever way you determine value versus the whole), sum the totals, and then rank. The replacement pitcher will be the 109th pitcher so ranked in each league, someone like Randall Delgado, who threw 139 innings of 4.26 ERA and 1.19 WHIP last year, with five wins and 79 strikeouts, or Steve Delabar, who threw 79 innings of 3.22 ERA, 82 strikeouts and a 1.34 WHIP, with five wins and one save. Chris Perez saved 25 games, but his 4.33 ERA and 1.42 WHIP dropped him to replacement level.
As you can see, this is something of a technical matter. If you don’t create your own player prices there isn’t any reason to get too caught up in the issue. But it should be helpful to remember, as with WAR and VORP in the real game, that a player’s price is pegged to how much better he is than the guy available to replace him for free.
Note also that the Replacement Player is why a player who accumulates no stats on the year is worth -$4. That’s minus four dollars, the opportunity cost for not having someone playing, blocking the expected production of a replacement player.