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From BR Bullpen
Winter leagues were first established in the late 19th century. Due to the low salaries of players in those days, an avenue to earn money in the off-season was needed. Barnstorming was one option and a real job was another - a third was to play baseball all year round. Additionally this allowed leagues to develop in warmer climates, encouraging business in those regions. The leagues of this era tended to have a wide mix of players - big-league stars, bench-warmers, minor leaguers and amateur or semipro players would compete head-to-head. Additionally leagues such as the California Winter League and Cuban Winter League allowed Negro League stars to face off with white major leaguers, an option not available in the early 20th century in other leagues. The Cuban Winter League also allowed for players from outside the US to try their abilities against American pros.
In the late 1940s, the winter leagues began to change. With black stars now allowed to play in the majors and increasing salaries for professional players, winter leagues became dominated more by developing prospects and international players. The Caribbean Series was established and numerous Latin American countries had winter leagues operating by the late 1950s - in addition to the Cuban Winter League there were the Puerto Rican Winter League, Panama League, Venezuelan League, Mexican Pacific League, Nicaraguan League, Colombian League, Occidental League, Veracruz League and Dominican League. This was the peak of winter ball.
Leagues began to fold in the late 1950s and early 1960s and the Caribbean Series vanished for almost all of the 1960s before being restarted in 1970. The winter leagues stabilized in the 70s with the "big four" of the Dominican League, Mexican Pacific League, Venezuelan League and Puerto Rican Winter League.
In the 1990s several other leagues were attempted such as the Hawaii Winter League, California Fall League, Maryland Fall League and Australia League but these were short-lived. The first major US-based winter league in some time was established in the form of the Arizona Fall League and survived.
The Panama League was briefly revived in the early 21st century, with the backing of Major League baseball, but lasted just one season.
In 2004 the Nicaraguan League was re-established as well. It lasted for four seasons, the last two chaotic, before suspending play. A revival is scheduled for the winter of 2009-10.
Even Puerto Rico, a bastion of winter play, lost the 2007-08 season before re-emerging.