Using results from 26 Major League Baseball seasons,
we investigate the connection between behavior bias, managerial
success, and tenure. We ask
whether managers that have overachieved, relative to prior seasons, have a
greater chance of remaining in that role, and if so, what was the subsequent effect
on team performance. Our results indicate that MLB owners and team general
managers are susceptible to behavioral biases. Team managers that overachieve
in a season, relative to recent, historical team performance, endure longer
tenures with their team, however, overachieving managers have statistically
similar career win percentages to managers who underachieved. This result
suggests that outperformance shouldn’t be a factor when evaluating team
managers but is often a driving force for decision making.
