Advanced Search
MyIDEAS: Login

An Exception to the Risk Preference Anomaly

Contents:

Author Info

  • Busche, Kelly
  • Hall, Christopher D
Registered author(s):

    Abstract

    The theory of risk bearing implies risk aversion. In every published study of horse race betting known to the authors, however, investigators reject this implication in favor of "ri sk-loving" behavior. Using the techniques of these studies, the auth ors examine a new data set from Hong Kong and find a rather different result: Hong Kong bettors seem to be either risk neutral or risk ave rse. A striking difference between the Hong Kong data and the previou sly studied North American data is the much larger betting volume per race. Copyright 1988 by the University of Chicago.

    Download Info

    If you experience problems downloading a file, check if you have the proper application to view it first. In case of further problems read the IDEAS help page. Note that these files are not on the IDEAS site. Please be patient as the files may be large.
    File URL: http://www.jstor.org/fcgi-bin/jstor/listjournal.fcg/00219398/.61-.67
    File Function: full text
    Download Restriction: Access to full text is restricted to JSTOR subscribers. See http://www.jstor.org for details.

    As the access to this document is restricted, you may want to look for a different version under "Related research" (further below) or search for a different version of it.

    Bibliographic Info

    Article provided by University of Chicago Press in its journal Journal of Business.

    Volume (Year): 61 (1988)
    Issue (Month): 3 (July)
    Pages: 337-46

    as in new window
    Handle: RePEc:ucp:jnlbus:v:61:y:1988:i:3:p:337-46

    Contact details of provider:
    Web page: http://www.journals.uchicago.edu/JB/

    Related research

    Keywords:

    References

    No references listed on IDEAS
    You can help add them by filling out this form.

    Citations

    Citations are extracted by the CitEc Project, subscribe to its RSS feed for this item.
    as in new window

    Cited by:
    1. Marco Ottaviani & Peter Norman Sorensen, 2010. "Noise, Information, and the Favorite-Longshot Bias in Parimutuel Predictions," American Economic Journal: Microeconomics, American Economic Association, vol. 2(1), pages 58-85, February.
    2. Frédéric KOESSLER & Anthony ZIEGELMEYER & Marie-Hélène BROIHANNE, 2002. "The Favorite-Longshot Bias in Sequential parimutuel Betting with Non-Expected Utility Players," Working Papers of BETA 2002-12, Bureau d'Economie Théorique et Appliquée, UDS, Strasbourg.
    3. Michael Cain & David Peel, 2004. "The utility of gambling and the favourite-longshot bias," The European Journal of Finance, Taylor & Francis Journals, vol. 10(5), pages 379-390.
    4. Per Binde, 2005. "Gambling Across Cultures: Mapping Worldwide Occurrence and Learning from Ethnographic Comparison," International Gambling Studies, Taylor & Francis Journals, vol. 5(1), pages 1-27, June.
    5. Leighton Vaughan Williams & David Paton, 1998. "Why are some favourite-longshot biases positive and others negative?," Applied Economics, Taylor & Francis Journals, vol. 30(11), pages 1505-1510.
    6. Vaughan Williams, Leighton, 1999. "Information Efficiency in Betting Markets: A Survey," Bulletin of Economic Research, Wiley Blackwell, vol. 51(1), pages 1-30, January.
    7. Erik Snowberg & Justin Wolfers, 2010. "Explaining the Favorite-Long Shot Bias: Is it Risk-Love or Misperceptions?," Journal of Political Economy, University of Chicago Press, vol. 118(4), pages 723-746, 08.
    8. Marshall Gramm & Douglas Owens, 2005. "Determinants of betting market efficiency," Applied Economics Letters, Taylor & Francis Journals, vol. 12(3), pages 181-185.
    9. Martin Kukuk & Stefan Winter, 2008. "An Alternative Explanation of the Favorite-Longshot Bias," Journal of Gambling Business and Economics, University of Buckingham Press, vol. 2(2), pages 79-96, September.
    10. Anil Gulati & Shekar Shetty, 2007. "Empirical evidence of error in pricing of favorites and longshots in greyhound racing," Journal of Economics and Finance, Springer, vol. 31(1), pages 49-58, March.
    11. Brown, Lawrence D. & Lin, Yi, 2003. "Racetrack betting and consensus of subjective probabilities," Statistics & Probability Letters, Elsevier, vol. 62(2), pages 175-187, April.
    12. Herman O. Stekler & David Sendor & Richard Verlander, 2009. "Issues in Sports Forecasting," Working Papers 2009-002, The George Washington University, Department of Economics, Research Program on Forecasting.
    13. Vaughan Williams, Leighton & Stekler, Herman O., 2010. "Sports forecasting," International Journal of Forecasting, Elsevier, vol. 26(3), pages 445-447, July.
      • Herman O. Stekler, 2007. "Sports Forecasting," Working Papers 2007-001, The George Washington University, Department of Economics, Research Program on Forecasting, revised Jan 2007.
    14. Stefan Winter & Martin Kukuk, 2008. "Do horses like vodka and sponging? - On market manipulation and the favourite-longshot bias," Applied Economics, Taylor & Francis Journals, vol. 40(1), pages 75-87.
    15. Les Coleman, 2004. "New light on the longshot bias," Applied Economics, Taylor & Francis Journals, vol. 36(4), pages 315-326.
    16. Russell Sobel & S. Travis Raines, 2003. "An examination of the empirical derivatives of the favourite-longshot bias in racetrack betting," Applied Economics, Taylor & Francis Journals, vol. 35(4), pages 371-385.
    17. Jullien, Bruno & Salanié, Bernard, 2005. "Empirical Evidence on the Preferences of Racetrack Bettors," IDEI Working Papers 178, Institut d'Économie Industrielle (IDEI), Toulouse.
    18. David Paton & Leighton Vaughan Williams, 2001. "Monopoly Rents and Price Fixing in Betting Markets," Review of Industrial Organization, Springer, vol. 19(3), pages 265-278, November.

    Lists

    This item is not listed on Wikipedia, on a reading list or among the top items on IDEAS.

    Statistics

    Access and download statistics

    Corrections

    When requesting a correction, please mention this item's handle: RePEc:ucp:jnlbus:v:61:y:1988:i:3:p:337-46. See general information about how to correct material in RePEc.

    For technical questions regarding this item, or to correct its authors, title, abstract, bibliographic or download information, contact: (Journals Division).

    If you have authored this item and are not yet registered with RePEc, we encourage you to do it here. This allows to link your profile to this item. It also allows you to accept potential citations to this item that we are uncertain about.

    If references are entirely missing, you can add them using this form.

    If the full references list an item that is present in RePEc, but the system did not link to it, you can help with this form.

    If you know of missing items citing this one, you can help us creating those links by adding the relevant references in the same way as above, for each refering item. If you are a registered author of this item, you may also want to check the "citations" tab in your profile, as there may be some citations waiting for confirmation.

    Please note that corrections may take a couple of weeks to filter through the various RePEc services.