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Do Gamblers Think That Teams Tank? Evidence from the NBA

Author Info

Listed author(s):
  • Soebbing, Brian

    (University of Alberta, Physical Education and Recreation)

  • Humphreys, Brad

    ()

    (University of Alberta, Department of Economics)

Abstract

A growing body of literature indicates that sports teams face incentives to lose games at the end of the season. This incentive arises from league entry draft policy. We use data from betting markets to confirm the existence of tanking, or the perception of tanking, in the NBA. Results from a SUR model of point spreads and point differences in NBA games indicate that betting markets believe that tanking takes place in the NBA, even though the evidence that tanking actually exists is mixed. NBA policy changes also affect betting market outcomes.

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File URL: https://sites.ualberta.ca/~econwps/2010/wp2010-13.pdf
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Paper provided by University of Alberta, Department of Economics in its series Working Papers with number 2010-13.

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Length: 21 pages
Date of creation: 25 Aug 2010
Handle: RePEc:ris:albaec:2010_013
Contact details of provider: Postal:
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Phone: (780) 492-3406
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Web page: http://www.ualberta.ca/economics

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Keywords: incentives; betting markets; tanking;

Other versions of this item:

Find related papers by JEL classification:
  • D49 - Microeconomics - - Market Structure, Pricing, and Design - - - Other
  • L83 - Industrial Organization - - Industry Studies: Services - - - Sports; Gambling; Restaurants; Recreation; Tourism

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Cited by:

  1. Colin Green & Fernando Lozano & Rob Simmons, 2015. "Rank-Order Tournaments, Probability of Winning and Investing in Talent: Evidence from Champions' League Qualifying Rules," National Institute Economic Review, National Institute of Economic and Social Research, vol. 232(1), pages 30-40, May.
  2. Benjamin Waggoner & Daniel Wines & Brian P. Soebbing & Chad S. Seifried & Jean Michael Martinez, 2014. "“Hot Hand” in the National Basketball Association Point Spread Betting Market: A 34-Year Analysis," International Journal of Financial Studies, MDPI, Open Access Journal, vol. 2(4), pages 1-12, November.
  3. Arne Feddersen & Brad Humphreys & Brian Soebbing, 2013. "Sentiment Bias in National Basketball Association Betting," Working Papers 13-03, Department of Economics, West Virginia University.

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