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Via Forbes.com:

While seven-figure bonuses have become the norm for top baseball picks, the league has actually done a pretty good job of taming the inflation that was so rampant in the 1990s, according to Baseball America Executive Editor Jim Callis.

During that decade, bonuses increased by double-digit percentages in every year but one, including three jumps of 40% or more.

The catalyst was infamous Yankee prospect Brien Taylor, who shattered the bonus record after he signed for $1.55 million as the top pick out of high school in 1991. Taylor eventually flopped, never making it to Yankee Stadium. By the end of the decade, owners had figured out a way to curtail the upward spiral of signing bonuses.

In 2000, the commissioner's office recommended a slotting system for the owners to follow, which set limits on the bonus of a top-five pick. While you'd think the players union would be up in arms about such price fixing, it isn't.

Why?

An agent who thinks a certain player can get more than a slotted amount for a high draft pick simply makes it known his client won't sign with a team poised to take him in the top five. The result: The player slips down to a large-market team that's willing to meet his demands.

"It plays right into the hand[s] of the big market teams," Callis says, adding that's how the Yankees were able to draft top pitching prospects Joba Chamberlain and Ian Kennedy.

So maybe it's no surprise that many of the top picks fizzle; they're chosen as much for economics as they are for ability.

Not that small-market teams mind such an arrangement--not when it comes complete with a generous revenue-sharing arrangement. With the draft costing the league's 30 teams some $150 million annually, the likes of Pittsburgh and Milwaukee are happy to make the trade-off.

"Most teams don't have a problem with the Yankees and Red Sox going over the slots," Callis says. "Those two teams effectively pay for their draft."