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Point Shaving In College Basketball: A Cautionary Tale For Forensic Economics

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  • DAN BERNHARDT
  • STEVEN HESTON

Abstract

Point shaving is the practice by favored teams of attempting to win by less than the point spread to yield profits for gamblers who bet on the underdog. Consistent with point shaving, strong favorites are anomalously likely to win by less than the spread. To distinguish between innocent and criminal explanations, we (1) exploit information in line movements and (2) isolate games without betting lines to identify games where point shaving is implausible and document similar patterns. The data are better explained by strategic efforts to maximize the probability of winning. These findings highlight the importance of methodology design. (JEL L83, K42)

Suggested Citation

  • Dan Bernhardt & Steven Heston, 2010. "Point Shaving In College Basketball: A Cautionary Tale For Forensic Economics," Economic Inquiry, Western Economic Association International, vol. 48(1), pages 14-25, January.
    • Handle: RePEc:bla:ecinqu:v:48:y:2010:i:1:p:14-25
    DOI: 10.1111/j.1465-7295.2009.00253.x
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    Cited by:

    1. Helmut M. Dietl & Markus Lang & Stephan Werner, 2010. "Corruption in Professional Sumo: An Update on the Study of Duggan and Levitt," Journal of Sports Economics, , vol. 11(4), pages 383-396, August.
    2. Shane Sanders & Justin Ehrlich & James Boudreau, 2017. "Cycles in Team Tennis and Other Paired-Element Contests," Games, MDPI, vol. 8(3), pages 1-14, June.
    3. Ryan Rodenberg, 2013. "Employee Discipline And Basketball Referees: A Prediction Market Approach," Journal of Prediction Markets, University of Buckingham Press, vol. 7(2), pages 43-54.
    4. Tobias J. Moskowitz, 2021. "Asset Pricing and Sports Betting," Journal of Finance, American Finance Association, vol. 76(6), pages 3153-3209, December.
    5. Alasdair Brown & Fuyu Yang, 2017. "Have Betting Exchanges Corrupted Horse Racing?," Journal of Sports Economics, , vol. 18(7), pages 673-697, October.
    6. Rodenberg Ryan, 2011. "Perception ? Reality: Analyzing Specific Allegations of NBA Referee Bias," Journal of Quantitative Analysis in Sports, De Gruyter, vol. 7(2), pages 1-13, May.
    7. Adam Hoffer & Jared A. Pincin, 2019. "Quantifying NFL Players’ Value With the Help of Vegas Point Spreads Values," Journal of Sports Economics, , vol. 20(7), pages 959-974, October.
    8. Michael Jetter & Jay K. Walker, 2017. "Good Girl, Bad Boy? Evidence Consistent with Collusion in Professional Tennis," Southern Economic Journal, John Wiley & Sons, vol. 84(1), pages 155-180, July.
    9. Ryan M. Rodenberg, 2013. "The goals and impacts of age restrictions in sports," Chapters, in: Eva Marikova Leeds & Michael A. Leeds (ed.), Handbook on the Economics of Women in Sports, chapter 8, pages 156-172, Edward Elgar Publishing.
    10. Berkowitz, Jason P. & Depken II, Craig A. & Gandar, John M., 2018. "Market evidence against widespread point shaving in college basketball," Journal of Economic Behavior & Organization, Elsevier, vol. 153(C), pages 283-292.
    11. Christian Deutscher & Eugen Dimant & Brad R. Humphreys, 2017. "Match Fixing and Sports Betting in Football: Empirical Evidence from the German Bundesliga," Working Papers 17-01, Department of Economics, West Virginia University.
    12. Alasdair Brown, 2012. "Examining Agency Conflict in Horse Racing," Southern Economic Journal, John Wiley & Sons, vol. 79(2), pages 388-398, October.
    13. Helmut Dietl & Markus Lang & Stephan Werner, 2008. "Corruption in Professional Sumo: An Update on Duggan and Levitt's Study," Working Papers 0019, University of Zurich, Center for Research in Sports Administration (CRSA), revised Jun 2009.
    14. Rodney J. Paul & Andrew P. Weinbach, 2012. "Response to Comment on “Investigating Allegations of Pointshaving in NCAA Basketball Using Actual Sportsbook Betting Percentagesâ€," Journal of Sports Economics, , vol. 13(2), pages 211-217, April.
    15. Eric Zitzewitz, 2012. "Forensic Economics," Journal of Economic Literature, American Economic Association, vol. 50(3), pages 731-769, September.

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    More about this item

    JEL classification:

    • L83 - Industrial Organization - - Industry Studies: Services - - - Sports; Gambling; Restaurants; Recreation; Tourism
    • K42 - Law and Economics - - Legal Procedure, the Legal System, and Illegal Behavior - - - Illegal Behavior and the Enforcement of Law

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