trsnoke
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FIP was invented to look at outcomes of plays where fielders aren't involved so it is supposed to ignore part of the game. Ignoring part of the game is something all stats do because that's the way they are designed. Strikeout totals only look at one kind of out. OBP treats all reach base events equally. AVG ignores certain plate outcomes, even some batted ball ones. In my opinion FIP works well as a good overall evaluator (but still not one I'd use alone) so maybe the things that it disregards are accounted for sufficiently by proxy or are maybe some things don't need to be accounted for exactly, as traditional thought believes. By looking at BB, K and HR per IP, it includes some things that are pretty location dependent so maybe those serve to be a pretty good proxy for "location" in general.
I think the biggest factor that makes FIP work is that it's application is limited to a small population where it can work. In my study above, I looked at just MLB pitchers that pitched a minimum of 150 innings in each of two consecutive years. By definition, that's going to be a pretty decent group of pitchers overall. At the very least, it includes pitchers that management believes is capable of pitching quality innings at the big league level or they wouldn't be out there. FIP wouldn't work for you or me or probably for most minor leaguers because the talent distribution is too wide (I would not be abe to locate). The difference betwen Justin Verlander and Kyle Lohse, though, is not nearly as wide as the difference between Lohse and a career minor leaguer. I am sure there are differences between ptichers in ability to induce weakly hit balls but some weakly hit balls are still hits and some well hit balls are still outs and over time the BABIP distribution of MLB pitchers is pretty tight. Verlander's is a relatively low .283 but Randy Wolf's is .286. Kyle Kendrick sports a .290, slightly lower than Halladay's .292. CC Cabathia's is also .292 while Freddy Garcia's is .284. As of yet, I don't think anyone has come up with good ways to identify guys who are better than most and will continue to be (repeatable skill) at inducing weakly hit balls. I'm sure when that's available, adjustments will be made. Most analysts do look at BABIP history for a given pitcher and if he has been able to maintain a lower than average BABIP, they'll note that, though.