As we head into the Winter Meetings and the hotter portion of the “Hot Stove Season,” we will surely be asked to evaluate trades. How does one compare two sides of real or prospective deals to each other?
In one popular method of making that comparison, baseball analysts reduce the value of a baseball player’s on-field contributions to a single number (Wins Above Replacement, or WAR), establish how much one WAR is worth in dollars, then compare that to how much a player is owed over the life of his contract. The result of this reduction is commonly called “Surplus Value.