The University of Buckingham Press Journals
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Herding in Imperfect Betting Markets with Inside Traders
No full textHerding is often considered as a phenomenon that drives prices of risky assets away from their equilibrium levels. In this paper we study the on-course UK and Australian horse betting markets. These are simple examples of imperfect markets for state-contingent assets. We provide strong evidence of herding behavior and show that the effects of herding are occasionally sufficient to render the markets inefficient even in the weak sense. Furthermore, the results demonstrate that traders with inside information are not always able to arbitrage away the effects of herding
WHO PAYS FOR THE MARYLAND LOTTERY?: EVIDENCE FROM POINT OF SALE DATA
No full textFor 42 states and the District of Columbia, lottery games provide a steady revenue source which can bring in up to 4% of annual state revenues. Unlike other public finance tools such as income taxes, lottery products enjoy substantial popularity. A particular reason they appear to be popular among state policymakers is that lotteries are often referred to as a “voluntary tax.” Compared to income taxes, however, relatively little is known about who plays the lottery and thus who provides states with this stream of “voluntary tax revenues.” State government budgets in the US are currently under pressure for both structural and cyclical reasons. As a result, many are debating the expansion of state-sponsored gambling to enhance their fiscal revenue streams. Previous studies have presented evidence that lotteries are regressive. For the current public policy debate to be fully informed, it is important to have information about who pays the “voluntary tax.” This paper uses unpublished FY 2005 sales data, provided by the Maryland Lottery Commission, from every individual lottery point of sale terminal in the state of Maryland. Because our data include the physical addresses of the terminals, we use an interdisciplinary approach to analyze this data by incorporating some tools from contemporary economic geography into our research. First, we marry the lottery-terminal data to census tract data and examine it using geographic information system (GIS) maps. We use the GIS maps to explore the relationship between race, income, per-capita lottery sales and the density of lottery retail sites. We also use the maps to attempt to shed some light on how different racial and income groups contribute to total state lottery revenues. To the best of our knowledge, this paper is the first in-depth use of GIS techniques to explore these questions.Because the data include not only the physical address of the terminal, but sales data disaggregated by lottery game, we are able to show the geographic distribution of the sales of particular lottery games, offering insight into how different games are played by the populations in different areas of the state. These analyses reflect new directions in the study of the lottery as a public policy issue, offering insights beyond the usual research on income and demographic effects.Finally, we present the results of a regression analysis of the effect of various social and economic factors on per-capita lottery sales. Our results confirm the findings of many previous studies, but also demonstrate that the nature of the demographic “burden” of the lottery may not be the same in Maryland as it is in other states where studies have been conducted.We are grateful for the assistance of Joe School and Anthony Dowell, for research support provided by the Special Research Initiative Fund at UMBC, to the Maryland Lottery Commission, and to participants of the Symposium on Gambling, Prediction Markets, and Public Policy hosted by Nottingham-Trent University. The opinions expressed in this paper are solely those of the authors
ARE BEHAVIORAL BIASES CONSISTENT ACROSS THE ATLANTIC?: THE OVER/UNDER MARKET FOR EUROPEAN SOCCER
No full textTests of the totals (Over/Under) market are performed for 22 European Soccer Leagues to determine if the behavioral biases found in North American sports betting markets are present in European Football (Soccer) betting markets. Even though European fans passionately follow a low-scoring sport, bettors/fans in this market still appear to prefer the over to the under. Simple betting strategies based on betting the over lose more than twice as much money as a simple strategy of betting the under and returns are found to be statistically different from a fair bet. In addition, when the over is the longshot, a favorite-longshot bias is found such that losses on the over are extremely high. When the under is the longshot, however, losses are nearly equal between overs and unders. This presents the possibility multiple behavioral biases may exist in the same financial market, with the presence of one possibly masking the other
Profiting from arbitrage and odds biases of the European football gambling market
No full textA gambling market is usually described as being inefficient if there are one or more betting strategies that generate profit, at a consistent rate, as a consequence of exploiting market flaws. This paper examines the online European football gambling market based on 14 European football leagues over a period of seven years, from season 2005/06 to 2011/12 inclusive, and takes into consideration the odds provided by numerous bookmaking firms. Contrary to common misconceptions, we demonstrate that the accuracy of bookmakers' odds has not improved over this period. More importantly, our results question market efficiency by demonstrating high profitability on the basis of consistent odds biases and numerous arbitrage opportunities
ASPECTS OF KENO MODELLING
No full textIn two earlier papers, an intricate Jackpot structure and analysis of pseudo-random numbers for Keno in the Australian state of Queensland circa 2000 were described. Aspects of the work were also reported at an international conference . Since that time, many aspects of the game in Australia have changed. The present paper presents more up-to-date details of Keno throughout the states of Queensland, New South Wales and Victoria. A much simpler jackpot structure is now in place and this is described. Two add-ons or side-bets to the game are detailed: the trivial Heads or Tails and the more interesting Keno Bonus, which leads to consideration of the subset sum problem. The most intricate structure is where Heads or Tails and Keno Bonus are combined, and here, the issue of independence arises. Closed expressions for expected return to player (ERTP) are presented in all cases
A STATISTICAL DEVELOPMENT OF FIXED ODDS BETTING RULES IN SOCCER
No full textTwo simple but seemingly profitable betting rules for betting on the away win in association football are developed. One rule is consistent with avoiding those games in which there is a clear favourite. The second rule is based directly on modelling bookmaker odds and assessing the residuals under the fitted model. Contrary to previous research the betting rule using the residuals suggests avoiding betting on those games where there are large discrepancies between bookmaker odds and predicted-model odds.
MEDIA REPORTAGE OF SEXUAL HARASSMENT: THE (IN)CREDIBLE COMPLAINANT
Get PDFStudies of court and conciliation decisions about credible complainants and legitimate sexual harassment. In determining what is reasonable and indeed in assessing whether behavior was sexual and unwelcome and resulted in humiliation, it is often the complainant’s identity, history and behaviour that are scrutinised and evaluated by conciliators and judicial officers. Youth can enhance credibility if the alleged harasser is older. Also, credible victims fight back, report immediately, are consistent in their evidence, are able to particularise and testify either in a non- aggressive and not too ‘smart’ manner or make an argumentative presentation coupled with confidence. Judicial commentary about the complainant’s relationships, dress and attitudes to sexuality is a chilling echo of Catharine MacKinnon’s 1979 observation that sexual harassment was often dismissed as “trivial, isolated, and ‘personal,’ or as universal ‘natural’ or ‘biological’ behaviours…
Early Season NBA Over/Under Bias
No full textIn this paper we analyze the total line betting market for National Basketball Association (NBA) regular season games for the 2009-2012 seasons. Specifically, we divide seasons by week and analyze points scored, total lines and game statistics such as field goal percentage and turnovers. We find the NBA total line market is generally very efficient with points scored and total lines increasing nearly evenly over the first 17 weeks of the season before leveling off. However, the total line market is inefficient in Week 1 with 58.2% of first week games having total scores less than total lines during our sample period. This win rate is significantly higher than the 52.38% win rate required for profiting from the betting strategy. Betting under total lines on all games in the first week on the 2009-2012 NBA season yields average returns of 11.1% per game
WAGERING IN AUSTRALIA: A RETROSPECTIVE BEHAVIOURAL ANALYSIS OF BETTING PATTERNS BASED ON PLAYER ACCOUNT DATA
No full textGambling research often relies on self-report and cross-sectional data which is limited by inaccuracies in recall. Analysis of behavioural data is necessary to advance conceptual understandings of gambling. This paper analysed player account data of 11,394 customers of a large Australian wagering operator over a ten-year period to investigate characteristics and betting patterns of account holders. Comparisons were made between players based on the total number of bets placed. More frequent bettors (those with greater total bet frequency counts), made smaller bets, but bet greater total amounts and lost smaller proportions as compared to less frequent bettors. Less frequent bettors bet larger single bets and lost a greater proportion of their total amounts bet. A minority of bettors accounted for a disproportionately high number of bets but lost the lowest proportion of these. The results indicate that players exhibit differential patterns of betting and subgroups of gamblers can be identified and appropriately targeted with player education and responsible gambling strategies
Competition and Monopoly in the Market for Pari-mutuel Bets - a theoretical Approach
No full textAn intertemporal state dependent expected utility model (generating S-shaped probability weighting by incorporating anticipated flows of utility from elation and disappointment) is used as a framework for analyzing the demand for various gambles. The analysis is extended to compare pari-mutuel bets under competitive and monopolistic conditions. The following conclusions can be drawn: (1) A monopoly fosters the `skeweness' of the pari-mutual bet: In equilibrium, the wager and the demand for probability to win are lower, while the wager per unit of probability to win and the prize are higher. (3) If prize expectations are endogenous, rollovers might be a necessary device to prevent instability. (4) Rational gamblers will be indifferent between `wager tax' and `bank holder' type methods of raising monopoly profits.I am grateful for helpful comments received from the participants at the `Conference on Gambling and Prediction Markets', organized by `Economica' and held at UCLA Riverside (20.-22 May 2007)