Handbook of Sports and Lottery Markets
- 1st Edition - September 2, 2008
- Imprint: North Holland
- Editors: G. Constantinides, Donald B. Hausch, H.M Markowitz, W.T. Ziemba, R.C. Merton, S.C. Myers, P.A. Samuelson, W.F. Sharpe, Kenneth J. Arrow
- Language: English
- Paperback ISBN:9 7 8 - 0 - 4 4 4 - 5 6 2 5 7 - 9
- Hardback ISBN:9 7 8 - 0 - 4 4 4 - 5 0 7 4 4 - 0
- eBook ISBN:9 7 8 - 0 - 0 8 - 0 5 5 9 9 5 - 7
Its basic empirical research and investigation of pure theories of investment in the sports and lottery markets make this volume a winner. These markets are simpler to study than… Read more
Purchase options
Institutional subscription on ScienceDirect
Request a sales quoteIts basic empirical research and investigation of pure theories of investment in the sports and lottery markets make this volume a winner. These markets are simpler to study than traditional financial markets, and their expected values and outcomes are uncomplicated. By means of new overviews of scholarship on the industry side of racetrack and other betting markets to betting exchanges and market efficiencies, contributors consider a variety of sports in countries around the world. The result is not only superior information about market forecasting, but macro- and micro-analyses that are relevant to other markets.
- Easily studied sports markets reveal features relevant for more complex traditional financial markets
- Significant coverage of sports from racing to jai alai
- New studies of betting exchanges and Internet wagering markets
Primary: university, research, and major public libraries with finance and economics holdings.
Secondary: academics in finance and economics
Secondary: academics in finance and economics
- Dedication
- List of Contributors
- Preface
- Introduction to the Series
- Part I: Industry Studies
- Chapter 1: Pari-Mutuel Horse Race Wagering—Competition from Within and Outside the Industry
- Abstract
- 1 INTRODUCTION
- 2 COMPETITION FROM CASINO GAMING
- 3 COMPETITION FROM STATE LOTTERIES
- 4 COMPETITION FROM PROFESSIONAL SPORTS
- 5 COMPETITION FROM LIVE RACING
- 6 COMPETITION FROM SIMULCAST WAGERING
- 7 SUMMARY AND CONCLUSIONS
- Chapter 2: Modeling Money Bet on Horse Races in Hong Kong
- Abstract
- 1 INTRODUCTION
- 2 VARIABLES EXAMINED
- 3 RESULTS AND DISCUSSION
- 4 CONCLUSION
- APPENDIX 31 Independent Variables Examined (Excluding Quadratic Terms)
- Chapter 1: Pari-Mutuel Horse Race Wagering—Competition from Within and Outside the Industry
- Part II: Utility, Probability, and Pace Estimation
- Chapter 3: Empirical Evidence on the Preferences of Racetrack Bettors
- 1 INTRODUCTION
- 2 SOME STYLIZED FACTS
- 3 EXPECTED UTILITY
- 4 DISTORTIONS OF PROBABILITIES
- 5 REFERENCE POINTS AND ASYMMETRIC PROBABILITY WEIGHTS
- 6 HETEROGENEOUS PREFERENCES
- 7 EXOTIC BETS
- 8 CONCLUDING REMARKS
- Chapter 4: Approximating the Ordering Probabilities of Multi-Entry Competitions by a Simple Method
- Abstract
- Acknowledgments
- 1 INTRODUCTION
- 2 THEORETICAL RESULTS OF THE LIMITING CASES
- 3 A SIMPLE APPROXIMATION
- 4 CONCLUSION
- APPENDIX: Proof of Theorem 1
- Chapter 5: Modeling Distance Preference and Pace Character in Thoroughbred Turf Racing
- Abstract
- Acknowledgment
- 1 BACKGROUND
- 2 CASE STUDY 1: SHA TIN (HONG KONG, SAR, PRC)
- 3 CASE STUDY 2: RANDWICK (SYDNEY, AUSTRALIA)
- 4 QUALITATIVE QUESTIONS
- 5 DISCUSSION
- Chapter 3: Empirical Evidence on the Preferences of Racetrack Bettors
- Part III: Favorite-Longshot Bias in the Win Market
- Chapter 6: The Favorite-Longshot Bias: An Overview of the Main Explanations
- Abstract
- 1 INTRODUCTION
- 2 NOTATION
- 3 MISESTIMATION OF PROBABILITIES
- 4 MARKET POWER BY INFORMED BETTORS
- 5 PREFERENCE FOR RISK
- 6 HETEROGENEOUS BELIEFS
- 7 MARKET POWER BY UNINFORMED BOOKMAKER
- 8 LIMITED ARBITRAGE
- 9 SIMULTANEOUS BETTING BY INSIDERS
- 10 TIMING OF BETS
- Chapter 7: Examining Explanations of a Market Anomaly: Preferences or Perceptions?
- Abstract
- Acknowledgments
- 1 INTRODUCTION
- 2 PREFERENCES—EXPECTED UTILITY MODELS WITH LINEAR PROBABILITIES
- 3 PERCEPTIONS—THE WEIGHTING OF TRUE PROBABILITIES
- 4 PERCEPTIONS–INFORMATIONAL EFFECTS
- 5 DEFINITION OF MODELS AND IMPLICATIONS FOR COMBINATORIC BETS
- 6 USING COMBINATORIC MARKETS TO TEST THE MODELS
- 7 CONCLUSION
- APPENDIX A Pricing of Combinatoric Bets Using Conditional Independence
- APPENDIX B Data
- Chapter 8: Unifying the Favorite-Longshot Bias with Other Market Anomalies
- 1 INTRODUCTION
- 2 BIASES FOUND IN THE PREVIOUS LITERATURE
- 3 WHAT CAUSES THE FAVORITE-LONGSHOT BIAS AT THE RACETRACK?
- 4 IS IT RISK OR INFORMATION?
- 5 CAN THE MODEL EXPLAIN THE BIASES IN OTHER MARKETS?
- 6 CONCLUSION
- Chapter 9: The Favorite-Longshot Bias in S&P 500 and FTSE 100 Index Futures Options: The Return to Bets and the Cost of Insurance
- Abstract
- 1 INTRODUCTION
- 2 METHODOLOGY
- 3 RESULTS
- 4 CONCLUSIONS
- Chapter 6: The Favorite-Longshot Bias: An Overview of the Main Explanations
- Part IV: Weak Market Efficiency
- Chapter 10: Efficiency of Racing, Sports, and Lottery Betting Markets
- Abstract
- Acknowledgments
- 1 INTRODUCTION
- 2 EXTENT OF GAMBLING IN THE U.S
- 3 RACETRACK BETTING MARKETS
- 4 THE FOOTBALL BETTING MARKET
- 5 THE BASKETBALL BETTING MARKET
- 6 LOTTERIES
- Chapter 11: Point Spread and Odds Betting: Baseball, Basketball, and American Football
- Abstract
- 1 INTRODUCTION
- 2 EFFICIENCY OF ODDS BETTING MARKETS
- 3 EFFICIENCY OF POINT SPREAD BETTING MARKETS
- 4 RELATIONSHIP OF POINT SPREAD AND ODDS BETTING
- 5 THE NORMAL MODEL AND MID-EVENT WAGERING
- 6 SUMMARY
- Chapter 12: Comparing Efficiency of the Over/Under-Bets on NFL and NBA Games
- 1 INTRODUCTION
- 2 THE SPORTS BETTING MARKET: SETTING POINT SPREADS AND OVER/UNDERS
- 3 NFL AND NBA BETTING MARKET EFFICIENCY
- 4 CONCLUSION
- Chapter 13: Arbitrage and Risk Arbitrage in Team Jai Alai
- Abstract
- Acknowledgments
- 1 INTRODUCTION
- 2 THE ARBITRAGE
- 3 RISK ARBITRAGES
- 4 FINAL REMARKS
- Chapter 10: Efficiency of Racing, Sports, and Lottery Betting Markets
- Part V: Semi-Strong Form Efficiency
- Chapter 14: Semi-Strong Form Information Efficiency in Horse Race Betting Markets
- Abstract
- 1 INTRODUCTION
- 2 SEMI-STRONG FORM EFFICIENCY IN HORSE RACE BETTING MARKETS: SINGLE VARIABLE MODELS
- 3 SEMI-STRONG FORM EFFICIENCY IN HORSE RACE BETTING MARKETS: MULTIPLE VARIABLE MODELS
- 4 SEMI-STRONG FORM EFFICIENCY IN HORSE RACE BETTING MARKETS: CONCLUSION
- Chapter 15: The Dosage Breeding Theory for Horse Racing Predictions
- Abstract
- Acknowledgments
- 1 INTRODUCTION
- 2 THE RACETRACK AS A SEQUENCE OF MARKETS
- 3 THE DOSAGE INDEX AND PERFORMANCE MEASURES
- 4 DATA ACQUISITION
- 5 APPLICATION OF BREEDING INFORMATION AND PERFORMANCE MEASURES TO REFINE ESTIMATED WIN PROBABILITIES FOR THE KENTUCKY DERBY
- 6 THE KELLY BETTING MODEL
- 7 THE KENTUCKY DERBY, 1981–2006
- 8 THE PREAKNESS STAKES, 1946–2006
- 9 THE BELMONT STAKES, 1946–2006
- 10 CONCLUSIONS
- Chapter 16: Efficiency in Horse Race Betting Markets: The Role of Professional Tipsters
- Abstract
- 1 INTRODUCTION
- 2 THE MODEL
- 3 DATA
- 4 RESULTS
- 5 CONCLUSION
- Appendix Proof of Equation (5)
- Chapter 14: Semi-Strong Form Information Efficiency in Horse Race Betting Markets
- Part VI: Prediction Markets
- Chapter 17: Index Betting for Sports and Stock Indices
- Abstract
- 1 BACKGROUND
- 2 HOW INDEX BETTING OPERATES
- 3 SETTING SPREADS
- 4 SPREADS IN PERFORMANCE INDICES
- 5 ADVANTAGEOUS BETS
- 6 REGULATION, TAXATION, AND BIASES IN SPREAD BETTING MARKETS
- Chapter 18: Prediction Markets: From Politics to Business (and Back)
- Abstract
- 1 OVERVIEW
- 2 THE FIRST PREDICTION MARKETS
- 3 MARKETS IN THE LAB
- 4 CURRENT USES OF PREDICTION MARKETS: BUSINESS AND POLICY
- 5 FUTURE DIRECTIONS: DECISION MARKETS
- 6 POTENTIAL PITFALLS
- 7 CONCLUSION
- Chapter 19: Betting Exchanges : A Technological Revolution in Sports Betting
- Abstract
- 1 INTRODUCTION
- 2 THE OPERATION OF BETTING EXCHANGES
- 3 EMPIRICAL MODELS AND EVIDENCE CONCERNING WEAK-FORM INFORMATION EFFICIENCY IN BETTING EXCHANGES
- 4 NEW EVIDENCE ON THE DEGREE OF BIAS IN BETTING EXCHANGE ODDS
- 5 CONCLUSIONS
- Chapter 17: Index Betting for Sports and Stock Indices
- Part VII: Soccer
- Chapter 20: Soccer Betting in Britain
- Abstract
- 1 INTRODUCTION
- 2 DEVELOPMENT OF SOCCER BETTING
- 3 TRANSACTIONS COSTS IN THE FIXED ODDS MARKET
- 4 EARLY STUDY OF MARKET EFFICIENCY
- 5 TIPSTERS
- 6 FUNDAMENTAL ANALYSIS AS AN AID TO SOCCER BETTING
- 7 TECHNICAL ANALYSIS
- 8 SENTIMENT
- 9 THE FUTURE OF RESEARCH ON SOCCER BETTING
- Chapter 21: Efficiency of Soccer Betting Odds—Evidence from a Pan-European Electronic Market
- Abstract
- Acknowledgments
- 1 INTRODUCTION
- 2 THE SOCCER BETTING MARKET
- 3 DATA DESCRIPTION
- 4 EFFICIENCY TESTS
- 5 CONCLUSION
- Chapter 20: Soccer Betting in Britain
- Part VIII: Lotteries
- Chapter 22: How to Design a Lottery
- Abstract
- Acknowledgments
- 1 INTRODUCTION
- 2 THE ODDS OF WINNING A (PARI-MUTUEL) LOTTERY
- 3 THE EXPECTED VALUE CALCULATION
- 4 HIGHER MOMENTS OF THE PRIZE DISTRIBUTION
- 5 ECONOMETRIC METHODOLOGY, DATA, AND ESTIMATES
- 6 GAME DESIGN SIMULATIONS
- 7 CONCLUSION
- APPENDIX: The Expected Value Formula
- Chapter 23: The Statistics of Lotteries
- Abstract
- 1 INTRODUCTION
- 2 PRIZE STRUCTURE AND WINNING CHANCES
- 3 TESTS OF RANDOMNESS
- 4 GAMBLER CHOICES
- Chapter 24: U.S. Lotto Markets
- Abstract
- 1 INTRODUCTION
- 2 DIFFERENCES BETWEEN AMERICAN AND EUROPEAN LOTTERIES
- 3 FUNGIBILITY OF LOTTERY REVENUES
- 4 EFFICIENCY OF LOTTERY MARKETS—PART 1
- 5 EFFICIENCY OF LOTTERY MARKETS—PART 2
- 6 EFFICIENCY OF LOTTERY MARKETS—PART 3
- 7 CONCLUSIONS
- Chapter 22: How to Design a Lottery
- Subject Index
- Author Index
- Edition: 1
- Published: September 2, 2008
- No. of pages (Hardback): 560
- No. of pages (eBook): 560
- Imprint: North Holland
- Language: English
- Paperback ISBN: 9780444562579
- Hardback ISBN: 9780444507440
- eBook ISBN: 9780080559957
GC
G. Constantinides
Affiliations and expertise
University of Chicago, Chicago, IL, USADH
Donald B. Hausch
Affiliations and expertise
University of Wisconsin, Madison, USAHM
H.M Markowitz
Affiliations and expertise
University of California-San Diego, La Jolla, CA, USAWZ
W.T. Ziemba
Affiliations and expertise
University of British Columbia, Vancouver, CanadaRM
R.C. Merton
Affiliations and expertise
Harvard Business School, Cambridge, MA, USASM
S.C. Myers
Affiliations and expertise
MIT, Sloan School of Management, Cambridge, MA, USAPS
P.A. Samuelson
Affiliations and expertise
Mass Inst. of Technology, Cambridge, MA, USAWS
W.F. Sharpe
Affiliations and expertise
Graduate School of Business, Stanford, CA, USAKA
Kenneth J. Arrow
Kenneth Arrow is the Joan Kenney Professor of Economics and Professor of Operations Research, emeritus; a CHP/PCOR fellow; and an FSI senior fellow by courtesy. He is the joint winner of the Nobel Memorial Prize in Economics with John Hicks in 1972. To date, he is the youngest person to have received this award, at 51. In economics, he is a figure in post-World War II neo-classical economic theory. Many of his former graduate students have gone on to win the Nobel Memorial Prize themselves. His most significant works are his contributions to social choice theory, notably "Arrow's impossibility theorem", and his work on general equilibrium analysis. He has also provided foundational work in many other areas of economics, including endogenous growth theory and the economics of information. He has been co-editor of the Handbooks in Economics series since the mid-1980s.
Affiliations and expertise
Kenneth Arrow, Joan Kenney Professor of Economics and Professor of Operations Research, Emeritus, Stanford University, Stanford, CA, USARead Handbook of Sports and Lottery Markets on ScienceDirect