The Journal of Gambling Business and Economics

Are English Football Betting Markets Efficient in the Presence of an Exogenous Shock?

2021-08-06T09:15:32+01:00

Football betting markets can be used to test the Efficient Market Hypothesis. This paper adds to literature in this field by investigating the effect of an exogenous shock to the English football betting markets. We analyse whether market expectations were correctly priced during the Covid-19 induced ghost game period. We find that the loss of home advantage is not fully incorporated into the betting odds. Hence, we find evidence of a violation to the semi-strong form of the Efficient Market Hypothesis. Given our analysis we are able to demonstrate some simple betting strategies that bettors could have used to yield high profits. Moreover, we carry out robustness checks with five additional betting providers and produce concordant findings.

Mergers in the US Gambling and Horse Racing Industries: What It Means for Local Economic Development and Taxation

2024-04-03T13:30:13+01:00

Even before the Covid-19 pandemic, most sectors of the various gambling industries in the United States were showing signs of stagnation. Over the last few years, these industries have seen mergers between horse racing tracks, between horse racing tracks and casinos to form “racinos”, and between casino companies. Many gambling facilities and racetracks have closed and have been sold to developers to be used for other purposes. An industry “shakeout” is occurring, and there appears to be a trend toward greater industry concentration as consumers are showing less and less interest in gambling in general. This has been partially fueled by stagnation of disposable personal income over the last 20 years or so. Consumer preferences and attitudes also seem to have changed regarding horse racing and gambling. Sports gambling and the expansion of online gambling do not appear to have offset negative trends. These current conditions are somewhat a reversal of past fortunes in that in the 1980s and 1990s the opening of a casino in a city often was considered a plus for local economic development. As more consolidation and establishment closures occur, the impact on various local communities and state governments must be examined regarding lost jobs, lost local and state tax revenues, and lost tourism. This paper is an attempt to assess these developments.

Evaluating the Efficiency of the National Football League Betting Market by Testing the Profitability of Suggested Gambling Rules

2023-08-28T11:06:59+01:00

Gambling on professional sports is becoming more popular across the country as states legalize the practice, causing more participants to seek out profitable betting strategies. A number of academic papers over the past 40 years have found profitable gambling rules on National Football League games. We show that six of these supposedly profitable strategies identified previously in the literature fail to hold up over other time frames. The betting market in football is not inefficient with respect to the situations covered by these six strategies and the rules are not long-run profitable.

In the Money: An Analysis of Monetary Value of Chips and Player Outcomes in No Limit Texas Hold’em Poker Tournaments

2023-12-07T15:32:39+00:00

This paper uses data from 25 World Series of Poker Circuit no-limit Texas Hold’em high-stakes multiday tournaments comprised of 17,852 entries to analyze changes in player rank outcomes based on chip stacks and prior-day rankings. High-stakes poker tournaments are comparatively expensive to enter and thus attract a higher percentage of skillful poker players. We find several interesting results. First, players that make it to the final table have 50% more chips than the average chip stack, after the first day of play. Players that finish in the money, but do not make it to the final table, have roughly the average chip stack and players that finish out of the money consistently have around half of day one’s average chip stack. We also found that for our sample, the players who made it to the final table were, on average, in the 70th percentile after day one. Only 48 out of 225 players (21.33%) came from the bottom half of the distribution after day one to the final nine players. We also evaluate the Independent Chip Model (ICM) and compare the results predicted by the model to the empirical results in our tournament data. We find that ICM does a fairly good job predicting overall results; however, players with the top 25% chip stacks on the final day of the tournament tend to moderately outperform their ICM expectations largely at the expense of the players with medium chip stacks. Shorter stacks, on the other hand, come closest to realizing their mathematical expectation.

Cashless Gambling: Potential Money Laundering and Responsible Gambling Initiatives

2023-12-24T02:28:34+00:00

Recent Australian government inquiries into casino, club, and hotel activities identified significant money laundering, and/or junket and links to organised crimes, and governance failings. The findings of two Royal Commissions determined that casinos in Sydney and Melbourne were not suitable entities to hold a gaming licence. Regulators gave these casinos two years to address concerns raised during these inquiries. One recommendation, supported by media reports and public health advocates, suggested the implementation of cashless gambling, that is, the use of non-cash forms of gambling (e.g., digital wallets, QR codes, or gambling debit cards). Others have expressed concerns about counterproductive or unintended consequences of tokenization of money and difficulties in monitoring expenditure. Although potentially useful as an anti-money laundering initiative, the effective use of cashless gambling as a harm minimisation/responsible gambling initiative requires careful consideration of its architecture, that is, the structure, processes and oversight of its implementation and operation. In this paper, we describe the complexities of cashless gambling and highlight relevant issues that need to be addressed. The findings of the various inquiries also raise serious questions regarding the proportion of funds commonly ascribed to individuals with gambling disorders. We conclude that key stakeholders (e.g., government, industry, financial and academic) need to collaborate to develop an optimal cashless gambling structure that achieves its intended objectives for responsible gambling over and above anti-money laundering.

Testing a System for Discerning Blackjack-Playing Tendencies from Card-by-Card Hand Histories: An Initial Simulation Using Bots

2024-04-23T07:22:51+01:00

The game of blackjack involves in-game actions that can materially affect the possible outcomes and/or their probabilities. In theory, with data from enough hands and decision points, researchers and gambling operators should be able to develop player profiles and then use those profiles to detect increased risk of gambling harm. However, it is currently unclear how much blackjack play is needed to accurately classify players. As a preliminary experiment, we separated blackjack hands into nine classes, and then proposed a total of twenty play patterns (“heuristics”) across hand classes to operationalize players’ strategies. We used our heuristics as components to construct 506 blackjack-playing bots to simulate human play. We then created a program that would read a session’s data and attempt to determine which bot generated that data. We found that for more infrequently occurring hand classes (e.g., pairs, soft hands), even 30 shoes of play were not enough to accurately determine the identity of a bot. With more frequent hand classes (e.g., hard hands), we could only accurately identify bots that played consistent strategies within 30 shoes. Results suggest that efforts to use blackjack hand histories and profile-fitting to generate markers for gambling harm might require simpler classification systems, or otherwise be limited to highly involved blackjack players.