Bettor Misperceptions in the NBA: The Overbetting of Large Favorites and the "Hot Hand"

by: Rodney J Paul, Andrew P Weinbach

Journal of Sports Economics, Vol. 6, No. 4. (1 November 2005), pp. 390-400.

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Abstract

Systematic bettor misperceptions are found in the NBA point spread gambling market for the seasons of 1995-1996 to 2001-2002. Evidence of the overbetting of favorites is found, with a strategy of betting big underdogs rejecting the null of a fair bet. Betting big home underdogs not only rejects a fair bet but is also shown to reject the null of no profitability. In addition, betting against winning streaks, as first suggested in the "hot-hand" article of Camerer and later tested by Brown and Sauer, is also shown to be profitable. 10.1177/1527002504266861

@article{paul-weinbach-05, abstract = {Systematic bettor misperceptions are found in the NBA point spread gambling market for the seasons of 1995-1996 to 2001-2002. Evidence of the overbetting of favorites is found, with a strategy of betting big underdogs rejecting the null of a fair bet. Betting big home underdogs not only rejects a fair bet but is also shown to reject the null of no profitability. In addition, betting against winning streaks, as first suggested in the "hot-hand" article of Camerer and later tested by Brown and Sauer, is also shown to be profitable. 10.1177/1527002504266861}, author = {Paul, Rodney J. and Weinbach, Andrew P. }, citeulike-article-id = {2658377}, doi = {http://dx.doi.org/10.1177/1527002504266861}, journal = {Journal of Sports Economics}, keywords = {pointsh}, month = {November}, number = {4}, pages = {390--400}, posted-at = {2008-04-11 17:53:42}, priority = {2}, title = {Bettor Misperceptions in the NBA: The Overbetting of Large Favorites and the "Hot Hand"}, url = {http://dx.doi.org/10.1177/1527002504266861}, volume = {6}, year = {2005} }

RIS record

TY - JOUR ID - paul-weinbach-05 L3 - citeulike-article-id:2658377 TI - Bettor Misperceptions in the NBA: The Overbetting of Large Favorites and the "Hot Hand" JF - Journal of Sports Economics VL - 6 IS - 4 SP - 390 EP - 400 N2 - Systematic bettor misperceptions are found in the NBA point spread gambling market for the seasons of 1995-1996 to 2001-2002. Evidence of the overbetting of favorites is found, with a strategy of betting big underdogs rejecting the null of a fair bet. Betting big home underdogs not only rejects a fair bet but is also shown to reject the null of no profitability. In addition, betting against winning streaks, as first suggested in the "hot-hand" article of Camerer and later tested by Brown and Sauer, is also shown to be profitable. 10.1177/1527002504266861 KW - pointsh AU - Paul, Rodney AU - Weinbach, Andrew PY - 2005/11/01/ UR - http://dx.doi.org/10.1177/1527002504266861 ER -

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