Access

You are not currently logged in.

Access JSTOR through your library or other institution:

login

Log in through your institution.

If You Use a Screen Reader

This content is available through Read Online (Free) program, which relies on page scans. Since scans are not currently available to screen readers, please contact JSTOR User Support for access. We'll provide a PDF copy for your screen reader.

Why is There a Favourite-Longshot Bias in British Racetrack Betting Markets

Leighton Vaughan Williams and David Paton
The Economic Journal
Vol. 107, No. 440 (Jan., 1997), pp. 150-158
Published by: Wiley on behalf of the Royal Economic Society
Stable URL: http://www.jstor.org/stable/2235276
Page Count: 9
  • Read Online (Free)
  • Subscribe ($19.50)
  • Cite this Item
Since scans are not currently available to screen readers, please contact JSTOR User Support for access. We'll provide a PDF copy for your screen reader.
Why is There a Favourite-Longshot Bias in British Racetrack Betting Markets
Preview not available

Abstract

In this paper we employ a large new data set to examine explanations of the tendency for favourites to be under-bet and longshots over-bet in recent British racetrack betting markets. We demonstrate that both demand and supply side factors can explain this favourite--longshot bias and propose new empirical tests to identify the influence of insider trading on the bias. The results suggest that the adverse selection problem faced by bookmakers, in the context of bettors who may possess superior information, is capable of explaining at least some of the observed bias.

Page Thumbnails

  • Thumbnail: Page 
150
    150
  • Thumbnail: Page 
151
    151
  • Thumbnail: Page 
152
    152
  • Thumbnail: Page 
153
    153
  • Thumbnail: Page 
154
    154
  • Thumbnail: Page 
155
    155
  • Thumbnail: Page 
156
    156
  • Thumbnail: Page 
157
    157
  • Thumbnail: Page 
158
    158