1. Revenue comes from a couple of sources in baseball.

Attendance, TV contracts,
merchandise, and revenue sharing. The primary cost that teams have is the salary of their
players. Holding all else equal, you definitely prefer to have a team that wins a lot of games
to one that does not, because future revenue streams from attendance and TV contracts are
positively correlated with attendance in the current time period, but without additional
information theres not a clear answer to the question. The relationship is also almost
certainly non-linear, and so you likely have to examine teams at an individual level to
understand where they fit on the win-curve as well.

2. Yes. Look no further than the markets adjustment in their willingness to quintuple Billy
Beanes salary.

3. Acting using insider information allowed them to outperform teams with similar budgets, in
addition to a willingness to deviate in strategy from convention.

4. Id critique their evidence by pointing out that the regression analysis itself feels really light.
Theres no acknowledgement whatsoever of the fact that theres going to be very high
multicollinearity between the slugging percentage and on-base percentage, especially since
it seems like a similar analysis could have been performed to control specifically for batting
average, walk percentage, and isolated slugging percentage, for which the degree of
multicollinearity should be lesser. Theres no attempt to control for NL vs. AL, which is
important in estimating individual coefficients since NL teams will have lower batting stats,
but will have their winning percentages pulled close to .500. This could be avoided if they
simply subtracted other-team batting from own-team batting. Id also consider it more
convincing if they had performed a sensitivity analysis that used some kind of pairwise
matching strategy for players and examined differences in payment between those matched
pairs.

5. Definitely not a coincidence that a low-budget team chose to exploit this rather than a
high-budget team. Its also the case that theres very much a principal-agent problem
involved in sports team management. Ex ante, choosing to try and pursue an experimental
strategy of that deviates from the norm has much higher variance (imagining all of the
different ways in which you could experiment), and a team in a favorable position has no
incentive to choose such a strategy.