BIG MARKET v SMALL MARKET BETTING

It is difficult to listen to baseball news without hearing about the money dilemmas of the small market teams and the "luxury taxes" imposed on the biggest spending big market clubs.
We have often felt that winning small market teams were undervalued in the betting lines, and that big market teams were often overvalued, whether they were winning or losing.
So we decided to do a survey to try to determine if this were in fact the case.
We picked out five big market teams and five small market clubs and compared them over six seasons, 1999-2004. This produced 60 team-seasons.
The big market teams were the Yankees, Red Sox, Mets, Cubs and Dodgers. The small market teams were the Padres, Pirates, Reds, Twins, and Royals.
We recorded overall season won-loss and overall performance v the betting line.
In the 30 team-seasons for the big market teams, only ten times did a team end up on the positive side at $1 per game risked on every game they played. However in 23 of the 30 seasons the teams had a winning record on the field, ranging from the 109-67 record of the Red Sox in '04 to the 82-80 of the '01 Mets. The Yankees had 100+ wins in five of the six years, but only twice were they in positive territory v. the line. The Mets were ahead in their two 100-win seasons, '99 and '00, but in the Cubs best year, 94-80 in '03, they were -$6 v. the line. Undervalued big market teams included the '99 Red Sox and the '04 Dodgers
Of the small market teams, 17 times they had a winning season v. the betting line. But in only 8 of the 30 seasons did they sport a winning won-loss record. Some of them had pretty bad teams, 12 of them losing over 90 games, two losing 100, while of big market teams, only 6 lost 90 games.
In all 8 successful won-loss years the small market teams were ahead v. the line.
Pairing a few teams is instructive: (W-L, $ at $1/game)

'03 Dodgers 85-77 -$6.66
'00 Reds 85-77 +$5.24

'02 Red Sox 93-69 -$9.51
'04 Twins 93-73 +$9.93

'99 Dodgers 77-85 -$15.22
'99 Pirates 78-83 +$9.56

'04 Dodgers 94-72 +$14.16
'99 Reds 96-67 +$27.95

'03 Mets 66-95 -$15.37
'99 Twins 63-97 -$6.84
These last two are really telling - two good seasons paired, and two bad ones.
Because of the disparities in W-L between the big and small market teams it is hard to match every team-season, and there were some big market seasons that did well v. the line and small market seasons that were extreme money-burners for any bettors who kept backing the team.
But the point is still clear: For betting purposes, big market teams attract disproportionate support from bettors, and smart wagerers will keep this in mind.