Beating the Spread: Testing the Efficiency of the Gambling Market for National Football League Games

Zuber, Richard A.; Gandar, John M.; Bowers, Benny D.

doi:10.1086/261332

Cited by 124 publications

(70 citation statements)

References 6 publications

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“…Moreover, sports 3 data are readily available and they are measured much more precisely than most economic data. This has led to studies on racial discrimination (Gwartney and Haworth, 1974;Kahn and Sherer, 1988;Nardinelli and Simon, 1990;Stone and Warren, 1999;Szymanski, 2000;Kanazawa and Funk, 2001;and Goff, McCormick and Tollison, 2002), efficiency of the betting market (Zuber, Gandar and Bowers, 1985;Sauer, Brajer, Ferris and Marr, 1988;Golec and Tamarkin, 1991;Dixon and Coles, 1997;and Gray and Gray, 1997), comparison of betting markets and financial markets (Levitt, 2004), the effect of labor strikes on consumer demand (Schmidt and Berri, 2004), preferences under risk (Julien and Salanié, 2000), mixed strategy equilibria Wooders, 2000, 2001;Chiappori, Levitt and Groseclose, 2002;and PalaciosHuerta and Volij, 2008), incentive effects (Ehrenberg and Bognanno, 1990), rationality (Gandar, Zuber, O'Brian and Russo, 1988), optimal labor contracts (Lazear and Rosen, 1981), control of externalities (Carlton, Frankel and Landes, 2004), favoritism (Garicano, Palacios-Huerta and Prendergast, 2005), maximizing behavior of firms (Romer, 2006;and Adams, 2006), and so on.…”

Section: Introductionmentioning

confidence: 99%

The efficiency of top agents: An analysis through service strategy in tennis

Klaassen

Magnus

2009

Journal of Econometrics

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We consider the question whether top tennis players in a top tournament (Wimbledon) employ an optimal (efficient) service strategy. While we show that top players do not, in general, follow an optimal strategy, our principal result is that the estimated inefficiencies are not large: the inefficiency regarding winning a point on service is on average 1.1% for men and 2.0% for women, implying that–by adopting an efficient service strategy–players can (on average) increase the probability of winning a match by 2.4%-points for men and 3.2%-points for women. While the inefficiencies may seem small, the financial consequences for the efficient player at Wimbledon can be substantial: the expected paycheck could rise by 18.7% for men and even by 32.8% for women. We use these findings to shed some light on the question of whether economic agents are successful optimizers

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Section: Introductionmentioning

confidence: 99%

The efficiency of top agents: An analysis through service strategy in tennis

Klaassen

Magnus

2009

Journal of Econometrics

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“…Although it is not necessarily an estimate of the difference in scores, the point spread has often been used in this capacity. Pankoff (1968), Vergin and Scriabin (1978), Tryfos, Casey, Cook, Leger, and Pylypiak (1984), Amoako-Adu, Manner, and Yagil (1985), and Zuber, Gandar, and Bowers (1985) considered statistical tests of the relationship between the point spread and the outcome of the game. Due to the large variance in football scores, they typically found that significant results (either proving or disproving a strong relationship) are difficult to obtain.…”

Section: Introductionmentioning

confidence: 99%

On the Probability of Winning a Football Game

Stern

1991

The American Statistician

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Based on the results of the 1981, 1983, and 1984 National Football League seasons, the distribution of the margin of victory over the point spread (defined as the number of points scored by the favorite minus the number of points scored by the underdog minus the point spread) is not significantly different from the normal distribution with mean zero and standard deviation slightly less than fourteen points. The probability that a team favored by p points wins the game can be computed from a table of the standard normal distribution. This result is applied to estimate the probability distribution of the number of games won by a team. A simulation is used to estimate the probability that a team qualifies for the championship playoffs.

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“…To begin our analysis, we will test the WNBA betting market under the null hypothesis of market efficiency using standard regression analysis outlined in Zuber et al [9] and Sauer et al [10]. Data for the WNBA gambling market was purchased from [1], a website specializing in sports gambling information.…”

Section: Market Efficiency Tests and Betting Simulations-wnbamentioning

confidence: 99%

Market Efficiency and Behavioral Biases in the WNBA Betting Market

Paul

Weinbach

2014

IJFS

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Abstract:The betting market for the Women's National Basketball Association (WNBA) is a thin financial market, which does not attract much interest from sports bettors. Given these characteristics, it is possible that profitable wagering strategies could exist for informed bettors of the WNBA. Using betting data on the WNBA from 2007-2012, we find that simple betting strategies do not earn statistically significant returns. WNBA bettors are like NBA bettors; however, in that they strongly prefer the best teams, particularly when they are on the road. Despite this clear bias, betting against the most popular public wagers is not found to earn statistically significant profits.

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Beating the Spread: Testing the Efficiency of the Gambling Market for National Football League Games

Cited by 124 publications

References 6 publications

The efficiency of top agents: An analysis through service strategy in tennis

The efficiency of top agents: An analysis through service strategy in tennis

On the Probability of Winning a Football Game

Market Efficiency and Behavioral Biases in the WNBA Betting Market

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