Using Forecasting to Detect Corruption in International Football

Corruption is hidden action aimed at influencing the outcome of an event away from its competitive outcome. It is likely common in all walks of life yet its hidden nature makes it diffcult to detect, while its distortionary influence on resource allocation ensures the importance of trying to detect it both practically and economically. This paper further develops methods to detect corrupt activity using data from 63 bookmakers covering over 9,000 international football matches since 2004, in particular assessing a claim made in early 2013 by Europol that the outcomes of almost 300 international matches since 2009 were fixed. We explore the divergence between two kinds of forecasts of match outcomes: those by bookmakers, and those constructed by econometric models. We argue that in the absence of corrupt activity to fix outcomes these two forecasts should be indistinguishable as they are based on the same information sets, and hence any divergence between the two may be indicative of corrupt activity to fix matches. In the absence of corroborating evidence we cannot declare any evidence procured in our manner as conclusive regarding the existence or otherwise of corruption, but nonetheless we argue that is it indicative. We conclude that there is mild evidence regarding potentially corrupt outcomes, and we also point towards yet more advanced strategies for its detection.