Handbook of Sports and Lottery Markets

  • G. Constantinides, University of Chicago, Chicago, IL, USA
    • H.M Markowitz, University of California-San Diego, La Jolla, CA, USA
      • R.C. Merton, Harvard Business School, Cambridge, MA, USA
        • S.C. Myers, MIT, Sloan School of Management, Cambridge, MA, USA
          • P.A. Samuelson, Mass Inst. of Technology, Cambridge, MA, USA
            • W.F. Sharpe, Graduate School of Business, Stanford, CA, USA
              • Kenneth Arrow, Kenneth Arrow, Joan Kenney Professor of Economics and Professor of Operations Research, Emeritus, Stanford University, Stanford, CA, USA
              • Edited by

                • Donald Hausch, University of Wisconsin, Madison, USA
                • W.T. Ziemba, University of British Columbia, Vancouver, Canada

                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 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.
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                Primary: university, research, and major public libraries with finance and economics holdings. Secondary: academics in finance and economics


Book information

  • Published: September 2008
  • Imprint: NORTH-HOLLAND
  • ISBN: 978-0-444-50744-0


"This timely and valuable volume showcases the frontier research in prediction markets by the very best researchers in the field. Issues of information aggregation and how the institutional backdrop influence such aggregation are age-old questions in Economics and Finance. The papers in this volume survey the current frontier, show how betting markets allow questions to be posed more sharply, and so yield more robust conclusions than is possible in more complex financial markets. The insights gained have many potentially fruitful applications in the design of institutions that promote information efficiency and for public policy more generally." --Hyun Song Shin, Princeton University "Hausch and Ziemba have produced a superb volume replete with papers from leading scholars in the economics of sports wagering and lotteries." --Raymond Sauer, Clemson University β€œThe editors of this book have assembled a set of world-renowned scholars to produce an accessible and authoritative review of the behavior of sports betting and lottery markets. The volume is essential reading for students and practitioners involved in betting markets.” --Rob Simmons, Lancaster University

Table of Contents

I. INDUSTRY STUDIES1. Pari-mutuel Horse Race Wagering – Competition from Within and Outside the IndustryMukhtar Ali, University of Kentucky and Richard Thalheimer, University of LouisvilleII. UTILITY AND PROBABILITY ESTIMATION2. Utility and preference estimationBruno Jullien, Universite de Toulouse and Bernard Salanie, Centre de Recherche en Economie et Statistique 3. Comparing Efficiency of the Over/Under Bets on NFL and NBA GamesJoseph Golec and Murray Tamarkin, Clark University4. Approximating the ordering probabilities of multi-entry competitions by a simple methodVictor Lo, Fidelity Investments, Boston and John Bacon-Shone, Social Sciences Research Centre. University of Hong KongIII. FAVORITE-LONGSHOT BIAS IN THE WIN MARKET5. The Favorite Longshot Bias: An Overview of the Main ExplanationsMarco Ottaviani, London Business School and Peter Norman Sorensen, University of Copenhagen 6. Examining explanations of a market anomaly: preferences or perceptions?Erik Snowberg, Stanford University and Justin Wolfers, University of Pennsylvania7. Unifying the Favorite-Longshot Bias with Other Market AnomaliesRussell S. Sobel and Matt E. Ryan, Department of Economics, West Virginia University8. The Favorite-Longshot Bias in S&P 500 and FTSE 100 Index Futures Options: The Return to Bets and the Cost of InsuranceRobert G. Tompkins, Hochschule fur Bankwirtschaft, Germany, William T. Ziemba, UBC, and Stewart D. Hodges, Univesity of WarwickIV. WEAK MARKET EFFICIENCY 9. Efficiency of racetrack betting marketsDonald B. Hausch, University of Wisconsin and William T. Ziemba, UBC 10. Modeling Distance Preference and Pace Character in Thoroughbred Turf RacingDavid Edelman, University College, Dublin11. Pointspread and Odds Betting in Baseball, Basketball and American FootballHal S. Stern, University of California, Irvine12. Arbitrage and risk arbitrage in Team Jai AlaiDaniel Lane, University of Ottawa and William T. Ziemba, UBC V. SEMI-STRONG FORM EFFICIENCY13. Semi-strong form efficiency in the horserace betting marketJohnnie Johnson and Ming-Chien Sung, University of Southhampton14. The dosage breeding theory for horseracing predictions Marshall Gramm, Rhodes College and William T. Ziemba, UBC15. Efficiency in Horse Race Betting Markets: The Role of Professional Tipsters Olivier Gergaud, University of Reims and Bruno Deschamps, University of Bath16. Hong Kong markets TBAJohn Bacon-Shone et al, Hong Kong UniversityVI. PREDICTION MARKETS17. Index betting for sports and stock indicesJohn Haigh, University of Sussex andLeighton Vaughan Williams, The Nottingham Trent University18. Prediction Markets: From Politics to Business (and Back)Erik Snowberg, Stanford University, Justin Wolfers, University of Pennsylvania and E. Zitzewitz, Dartmouth College19. Betting exchanges: a technological revolution in sports bettingMichael A. Smith, Canterbury Christ Church UniversityLeighton Vaughan Williams, Nottingham Business School, Nottingham Trent UniversityVII. SOCCER20. British soccer betting in BritainDavid Forrest, University of Salford 21. Efficiency of soccer betting odds - evidence from apan-European electronic marketStephen Kossmeier and Simon Weinberger, Institute for Advanced Studies, Vienna, AustriaVIII. LOTTERIES22. Economics of lottery marketsIan Walker, University of Warwick 23. The statistics of lotteriesJohn Haigh, University of Sussex24. US lotto marketsVictor Matheson, Holy Cross College and K. Grote, Lake Forest College