The Reverse Favourite-longshot Bias and Market Efficiency in Major League Baseball: An Update

2003 ◽  
Vol 55 (2) ◽  
pp. 113-123 ◽  
Author(s):  
Linda M. Woodland ◽  
Bill M. Woodland
Keyword(s):  
Market Efficiency ◽  
Major League Baseball ◽  
Major League

Behavioral Biases and Sportsbook Pricing in Major League Baseball

2012 ◽  
pp. 301-318 ◽  
Author(s):  
Rodney J. Paul ◽  
Andrew P. Weinbach
Keyword(s):  
Financial Markets ◽  
Market Efficiency ◽  
Major League Baseball ◽  
Prediction Markets ◽  
Large Margin ◽  
The Public ◽  
Sports Gambling ◽  
Betting Market ◽  
Major League ◽  
Alternative Theories

This article discusses the literature that uses sports gambling markets as an analogy to financial markets. It also expands the study of actual sportsbook behavior, comparing the traditional models to the Levitt hypothesis and considering alternative theories, by examining the betting market for Major League Baseball (MLB). The reverse favorite-longshot bias and home/road biases are then explored. It appears that bettors prefer road favorites by a large margin, but this is not captured by the sportsbook odds, which, likely not coincidentally, tend to map closer to actual favorite win percentages. There are no statistically significant returns to betting against the public. The findings that sportsbooks do not set prices to balance the book calls into question the source of some of the earlier findings of market efficiency in sports wagering markets and its underlying support for the forecasting power of prediction markets.

Baseball Home Field Advantage Without Fans in the Stands

2021 ◽  
Vol 16 (3) ◽  
Author(s):  
Jeremy Losak ◽  
Joseph Sabel
Keyword(s):  
Market Efficiency ◽  
Natural Experiment ◽  
Major League Baseball ◽  
Small Sample ◽  
Significant Evidence ◽  
Home Team ◽  
Home Field Advantage ◽  
Major League ◽  
Betting Markets ◽  
Home Conditions

Home field advantage is universally accepted across most major sports and levels of competition. However, exact causes of home field advantage have been difficult to disentangle. The COVID-19 pandemic offers a unique, natural experiment to isolate elements related to home field advantage since all 2020 regular season Major League Baseball games were played without fans. Results provide no statistically significant evidence of a difference in home field advantage between the 2019 and 2020 seasons, evidence that home crowd support is not a driver of home field advantage. There does appear to be a statistical advantage by the home team batting second in the inning. Travel fatigue seems to have no impact on home field advantage, and while home field advantage seems to increase throughout the 2020 season, we chalk that up to small sample noise. Despite lacking historical precedence, betting markets seemingly respond efficiently to the new home conditions. Keywords: home field advantage, market efficiency, baseball, ghost games

INFORMATION EFFECTS AND NATIONAL HOCKEY LEAGUE BETTING MARKET EFFICIENCY

2013 ◽  
Vol 6 (1) ◽  
pp. 79-92
Author(s):  
Matt E Ryan ◽  
Marshall Gramm ◽  
C. Nicholas McKinney
Keyword(s):  
Market Efficiency ◽  
Major League Baseball ◽  
National Hockey League ◽  
Heterogeneous Information ◽  
Information Effects ◽  
Betting Market ◽  
Major League ◽  
Time Of Year ◽  
General Movement ◽  
Available Information

Previous studies of the National Hockey League (NHL) betting market claim a general movement towards efficiency over the last two decades.  These studies, however, assume a homogenous betting market with regards to the time of year in which bets are placed.  Differences in available information—information effects—have been shown to distort the Major League Baseball betting market; they produce similar distortions when considered in the NHL market as well.  As such, previous claims of market efficiency must be revisited in light of heterogeneous information.

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