Corrupt Bookmaking in a Fixed Odds Illegal Betting Market

• 成果类型: Article
• 署名作者: Bag, Parimal Kanti; Saha, Bibhas
• 署名单位: National University of Singapore
• 刊物名称: ECONOMIC JOURNAL
• ISSN/ISSBN: 0013-0133
• DOI: 10.1111/ecoj.12483
• 发表日期: 2017
• 页码: 624-652
• 关键词: favorite-longshot bias; insider traders; contests; prices

摘要

Illegal betting in a two-team sports contest is studied with player sabotage instigated by a monopolist bookmaker. Whereas punters hold beliefs about the teams' winning chances correlated with Nature's draw, the bookmaker's information is noise-free. Enforcement investigates with a higher probability, the greater the upset. In such an environment, if punters do not suspect match-fixing, the favourite is bribed, thus creating upsets and intensifying subsequent investigations. Match-fixing continues to hold even when punters are rational, provided that the bookie's beliefs are noisy: the bookie bribes the team he thinks is the favourite and the bettors bet on their perceived favourites.