Manny Ramirez Contract

For all of you who do not follow MLB baseball as extensively as I do you may or may not have know about the Los Angelas Dodges acquisition of Manny Ramirez last year from the Boston Red Sox. This trade was absolutely one of the biggest of last year, the Dodgers could only sign him to a contract that lasted the remainder of the season. The pickup proved invaluable since Manny led the Dodgers nearly to the world series in less than two months of being on the team. After the 2008 season was over the Dodgers had to make decisions. They knew signing Manny would take up a lot of salary cap the team had. The first contract the Dodgers offered Manny was a two year deal worth forty million dollars. The team knew Manny was looking for a bigger contract so that offer was immediately turned down. So the Dodgers organization had to look at the marginal cost of trying to keep Manny. Manny is undoubtedly one of the best hitters in baseball which means he is a very hot commodity and that teams would be throwing big money at him. They had to decide if the marginal cost of increasing his contract to forty five million over two years would be worth it. In the end the Dodgers offered Manny five more million dollars over two years and he took the deal. It is too soon to tell if the marginal cost of five million dollars to keep Manny was worth it but by looking what he has done over the course of his career it is probably safe to say the Dodgers made the right decision. It is easy to see that the opportunity cost of keeping Manny Ramirez was much too high to the Dodgers to possibly let him sign with another team.