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It sets the overall statistical baselines for the league. How many K's, HR's. hits, walks etc. etc on a league-wide basis.
In general the game will take care of things and you shouldn't need to touch it. Some people really like to have a specific statistical environment though and then they'll end up micromanaging it. But if you're happy for the league to evolve through periods of more and less offense, then it's something you really don't need to worry much about.
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