Journal of Economics and Finance

, Volume 29, Issue 3, pp 416–426 | Cite as

The state of research on markets for sports betting and suggested future directions

  • Raymond D. SauerEmail author
Sports Symposium


Studies of markets for sports betting can be a rich source of knowledge on the process of price formation and the information content of market prices. But recent research in this field examines questions of a technical nature, questions of interest mostly to active participants in the literature. A change in direction, motivated by creative use of the efficiency hypothesis, may deliver insights that would be valuable to the profession in general. Some preliminary analyses along these lines are presented in the hope of stimulating new lines of inquiry in the field.


Major League Baseball Efficient Market Hypothesis Wager Market Efficient Price Home Team 
These keywords were added by machine and not by the authors. This process is experimental and the keywords may be updated as the learning algorithm improves.


Unable to display preview. Download preview PDF.

Unable to display preview. Download preview PDF.


  1. Asch, Peter, Burton G. Malkiel, and Richard E. Quandt. 1982. “Racetrack Betting and Informed Behavior.”Journal of Financial Economics 10:187–194.CrossRefGoogle Scholar
  2. Berg, Joyce, Forrest Nelson, and Thomas Rietz. 2001. “Accuracy and Forecast Standard Error of Prediction Markets.” Technical Report, University of Iowa, College of Business Administration.Google Scholar
  3. Brailsford, Timothy J., Stephen A. Easton, Philip K. Gray, and Stephen F. Gray. 1995 “The Efficiency of Australian Football Betting Markets.”Australian Journal of Management 20:167–195.CrossRefGoogle Scholar
  4. Brown, William O., and Raymond D. Sauer. 1993. “Fundamentals or Noise? Evidence from the Point Spread Betting Market.”Journal of Finance 48:1193–1209.CrossRefGoogle Scholar
  5. Camerer, Colin F. 1989. “Does the Basketball Market Believe in the Hot Hand?”American Economic Review 79:1257–1261.Google Scholar
  6. Crafts, N.F.R. 1985. “Some Evidence of Insider Knowledge in Horse Race Betting in Britain.”Economica 52:295–304.CrossRefGoogle Scholar
  7. Figlewski, Stephen. 1979. “Subjective Information and Market Efficiency in a Betting Market.”Journal of Political Economy 87:75–88.CrossRefGoogle Scholar
  8. Gandar, John, W. Dare, Craig Brown, and R. Zuber. 1998. “Informed Traders in the Betting Market for Professional Basketball Games.”Journal of Finance 53:385–401.CrossRefGoogle Scholar
  9. Hakes, Jahn K., and Raymond D. Sauer. 2004. “A Probability-Based Measure of Productivity in Major League Baseball with Application to the Questions of Clutch Performance and the Value of Pitching.” Manuscript,∼sauerr/papers.html.Google Scholar
  10. Hakes, Jahn K., Raymond D. Sauer and Kerry Waller. “The Progress of the Betting in a Baseball Game.” Paper presented at the 2005 Meeting of the Western Economic Association,∼sauerr/papers.html.Google Scholar
  11. Hanson, Robin. 2005. “Foul Play in information Markets.” InInformation Markets: A New Way of Making Decisions in the Public and Private Sectors, edited by Bob Hahn and Paul Tetlock. AEI-Brookings Press.Google Scholar
  12. James, Bill, and Jim Henzler. 2002.Win Shares. Stats Inc. Publishing.Google Scholar
  13. Maloney, Michael T., and J. Harold Mulherin. 2003. “The Complexity of Price Discovery in an Efficient Market: The Stock Market Reaction to the Challenger Crash.”Journal of Corporate Finance 9:453–479.CrossRefGoogle Scholar
  14. Paul, Rodney, Andrew Weinbach, and Chris Weinbach. 2003. “Fair Bets and Profitability in College Football Gambling.”Journal of Economics and Finance 27:235–242.Google Scholar
  15. Pennock, David M., C. Lee Giles, and Finn A. Nielsen. 2001. “The Real Power of Artificial Markets.”Science 291:987–988.CrossRefGoogle Scholar
  16. Roll, Richard. 1984. “Orange Juice and Weather.”American Economic Review 74:861–880.Google Scholar
  17. Sauer, Raymond. 1998. “The Economics of Wagering Markets.”Journal of Economic Literature 36:2021–2064.Google Scholar
  18. Spencer, Jakab. 2004. “New ICAP-Nymex Derivatives Have U.S. Gas Markets Number.”Wall Street Journal (August 4).Google Scholar
  19. Strumpf, Koleman. 2003. “Illegal Sports Bookmakers.” Working paper,∼cigar.Google Scholar
  20. Weinbach, Andrew. 2005. “Gambling and the Poor.” Ph.D. Dissertation, John E. Walker Department of Economics, Clemson University.Google Scholar
  21. Wolfers, Justin, and Eric Zitzewitz. 2004. “Prediction Markets.”Journal of Economic Perspectives 18:107–126.CrossRefGoogle Scholar
  22. Woodland, Linda M., and Bill M. Woodland. 2003. “The Reverse Favourite-Longshot Bias and Market Efficiency: An Update.”Bulletin of Economic Research 55:113–123.CrossRefGoogle Scholar

Copyright information

© Springer 2005

Authors and Affiliations

  1. 1.Department of EconomicsClemson UniversityClemson

Personalised recommendations