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A comment on Paul, Weinbach, and Wilson’s (2004) “Efficient markets, fair bets, and profitability in NBA totals 1995-96 to 2001-02”

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  • Moore, Evan

Abstract

This paper revisits Paul et al. (2004) using a more recent data set to test for inefficiencies in the totals market for NBA games. Using data from the 1995-96 to 2001-02 seasons, Paul et al. (2004) found the market as a whole to be efficient, but that this was not the case for bets on the highest of point totals. Using data from the 2012-13 to 2018-19 seasons reveals a market that is more efficient than that of their earlier work, as the null hypothesis of a fair bet is not rejected for the higher totals. However, winning percentages in excess of 52.4 % were found further in the upper tail of the distribution of points totals relative to the earlier period.

Suggested Citation

  • Moore, Evan, 2021. "A comment on Paul, Weinbach, and Wilson’s (2004) “Efficient markets, fair bets, and profitability in NBA totals 1995-96 to 2001-02”," The Quarterly Review of Economics and Finance, Elsevier, vol. 82(C), pages 26-29.
    • Handle: RePEc:eee:quaeco:v:82:y:2021:i:c:p:26-29
    DOI: 10.1016/j.qref.2021.07.002
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    References listed on IDEAS

    as
    1. Sauer, Raymond D & Brajer, Vic & Ferris, Stephen P & Marr, M Wayne, 1988. "Hold Your Bets: Another Look at the Efficiency of the Gambling Market for National Football League Games: Comment," Journal of Political Economy, University of Chicago Press, vol. 96(1), pages 206-213, February.
    2. Kevin Krieger & Clay Girdner & Andy Fodor & David Kirch, 2013. "The Power Of Wagering On Power Conferences," Journal of Prediction Markets, University of Buckingham Press, vol. 7(1), pages 13-26.
    3. Paul, Rodney J. & Weinbach, Andrew P. & Wilson, Mark, 2004. "Efficient markets, fair bets, and profitability in NBA totals 1995-96 to 2001-02," The Quarterly Review of Economics and Finance, Elsevier, vol. 44(4), pages 624-632, September.
    4. repec:bla:jfinan:v:43:y:1988:i:4:p:995-1008 is not listed on IDEAS
    5. Corey A. Shank, 2019. "NFL betting market efficiency, divisional rivals, and profitable strategies," Studies in Economics and Finance, Emerald Group Publishing Limited, vol. 36(4), pages 567-580, September.
    6. Kenneth Linna & Evan Moore & Rodney Paul & Andrew Weinbach, 2014. "The Effects of the Clock and Kickoff Rule Changes on Actual and Market-Based Expected Scoring in NCAA Football," IJFS, MDPI, vol. 2(2), pages 1-14, April.
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    More about this item

    Keywords

    Efficient markets; Gambling; Sports; Contrarian;
    All these keywords.

    JEL classification:

    • G1 - Financial Economics - - General Financial Markets

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