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Testing for Home Team and Favorite Biases in the Australian Rules Football Fixed-Odds and Point Spread Betting Markets

Author

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  • Adi Schnytzer

    (Bar-Ilan University, Israel)

  • Guy Weinberg

    (Bar-Ilan University, Israel)

Abstract

In this article, the authors test two different kinds of bias—the favorite-long shot/favorite-underdog bias and the home team bias—and distinguish between the two, using a distinctive feature of the Australian Football League (AFL): the fact that many games are played on neutral grounds. The authors conduct their tests by subjecting 2001-2004 data for the AFL to detailed scrutiny, using standard econometric weak-form efficiency models of point spread and fixed-odds betting markets. They reject the existence of any significant pure favorite-long shot/favorite-underdog bias in either market and demonstrate the existence of a significant bias in favor of teams with an apparent home ground advantage in games played outside Victoria in the point spread market and in the fixed-odds market during 2002, 2004, and the period as a whole. Games in Melbourne and in Geelong are free of such a bias (except for 2003 in the point spread market in Geelong). Betting simulations that attempt to exploit these inefficiencies yield modest profits.

Suggested Citation

  • Adi Schnytzer & Guy Weinberg, 2008. "Testing for Home Team and Favorite Biases in the Australian Rules Football Fixed-Odds and Point Spread Betting Markets," Journal of Sports Economics, , vol. 9(2), pages 173-190, April.
    • Handle: RePEc:sae:jospec:v:9:y:2008:i:2:p:173-190
    DOI: 10.1177/1527002506299079
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    8. Ryall Richard & Bedford Anthony, 2011. "The Intra-Match Home Advantage in Australian Rules Football," Journal of Quantitative Analysis in Sports, De Gruyter, vol. 7(2), pages 1-14, May.
    9. Adi Schnytzer, 2011. "The Prediction Market for the Australian Football League," Working Papers 2011-15, Bar-Ilan University, Department of Economics.

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