Do Bookmakers Possess Superior Skills to Bettors in Predicting Outcomes?

Michael A. Smith (), David Paton and Leighton Vaughan Williams ()

Post-Print from HAL

Abstract: In this paper we test the hypothesis that bookmakers display superior skills to bettors in predicting the outcome of sporting events by using matched data from traditional bookmaking and person-to-person exchanges. Employing a conditional logistic regression model on horse racing data from the UK we find that, in high liquidity betting markets, betting exchange odds have more predictive value than the corresponding bookmaker odds. To control for potential spillovers between the two markets, we repeat the analysis for cases where prices diverge significantly. Once again, exchange odds yield more valuable information concerning race outcomes than the bookmaker equivalents.

Keywords: D82; G12; G14; betting exchanges; market efficiency; prediction (search for similar items in EconPapers)
Date: 2009-03-31
Note: View the original document on HAL open archive server: https://hal.science/hal-00684229
References: View references in EconPapers View complete reference list from CitEc
Citations: View citations in EconPapers (27)

Published in Journal of Economic Behavior and Organization, 2009, 71 (2), pp.539. ⟨10.1016/j.jebo.2009.03.016⟩

Downloads: (external link)
https://hal.science/hal-00684229/document (application/pdf)

Related works:
Journal Article: Do bookmakers possess superior skills to bettors in predicting outcomes? (2009)
This item may be available elsewhere in EconPapers: Search for items with the same title.

Export reference: BibTeX RIS (EndNote, ProCite, RefMan) HTML/Text

Persistent link: https://EconPapers.repec.org/RePEc:hal:journl:hal-00684229

DOI: 10.1016/j.jebo.2009.03.016

Access Statistics for this paper

More papers in Post-Print from HAL
Bibliographic data for series maintained by CCSD ().