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The Double‐Auction Gambling Market: An Experimental Examination

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  • Kyle W. Hampton

Abstract

. I examine a new sports wagering mechanism that utilizes a double auction rather than the traditional wager matching bookmaker. Laboratory experiments were performed that modeled the two institutions in an attempt to compare the efficiency and volatility of the new mechanism versus the status quo. The new proposed double auction institution was less efficient and more volatile than the matching mechanism. However, the relative performance of the double auction mechanism was significantly improved by an increase in the size of the market.

Suggested Citation

  • Kyle W. Hampton, 2007. "The Double‐Auction Gambling Market: An Experimental Examination," American Journal of Economics and Sociology, Wiley Blackwell, vol. 66(3), pages 493-532, July.
    • Handle: RePEc:bla:ajecsc:v:66:y:2007:i:3:p:493-532
    DOI: 10.1111/j.1536-7150.2007.00524.x
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    References listed on IDEAS

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    1. Brice Corgnet & Cary Deck & Mark DeSantis & Kyle Hampton & Erik O. Kimbrough, 2023. "When Do Security Markets Aggregate Dispersed Information?," Management Science, INFORMS, vol. 69(6), pages 3697-3729, June.

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