The house doesn't always win: Evidence of anchoring among Australian bookies

作者：McAlvanah Patrick; Moul Charles C^*

来源：Journal of Economic Behavior & Organization, 2013, 90: 87-99.

DOI：10.1016/j.jebo.2013.03.009

• Anchoring bias
• Behavioral economics
• Fixed-odds wagering
• Natural experiment

We examine Australian horseracing bookmakers' responses to late scratches, instances in which a horse is abruptly withdrawn after betting has commenced. Our observed bookies exhibit anchoring on the original odds and fail to re-adjust odds fully on the remaining horses after a scratch, thereby earning lower profit margins and occasionally creating nominal arbitrage opportunities for bettors. We also examine which horses' odds bookies adjust after a scratch and demonstrate diminished profit margins even after controlling for these endogenous adjustments. Our results indicate that bookies' adjustments recover approximately 80% of lost profit margin but that bookies forgo the remaining 20% due to systematic under-adjustments.

• 出版日期2013-6