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Odd-setters as forecasters: the case of English football

Forrest, DK, Goddard, J and Simmons, R 2005, 'Odd-setters as forecasters: the case of English football' , International Journal of Forecasting, 21 (3) , pp. 551-564.

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Abstract

Sets of odds issued by bookmakers may be interpreted as incorporating implicit probabilistic forecasts of sporting events. Employing a sample of nearly 10 000 English football (soccer) games, we compare the effectiveness of forecasts based on published odds and forecasts made using a benchmark statistical model incorporating a large number of quantifiable variables relevant to match outcomes. The experts' views, represented by the published odds, are shown to be increasingly effective over a 5-year period. Bootstraps performed on the statistical model fail to outperform the expert judges. The trend towards odds-setters displaying greater expertise as forecasters coincided with a period during which intensifying competition is likely to have increased the financial penalties for bookmakers of imprecise odds-setting. In the context of a financially pressured environment, the main findings of this paper challenge the consensus that subjective forecasting by experts will normally be inferior to forecasts from statistical models.

Item Type: Article
Uncontrolled Keywords: Football, odds, ordered probit, comparative forecasting—causal, judgement, bootstrap-evaluation
Themes: Subjects / Themes > Q Science > QA Mathematics > QA275 Mathematical Statistics
Subjects / Themes > G Geography. Anthropology. Recreation > GV Recreation Leisure > GV0557 Sports
Subjects outside of the University Themes
Schools: Colleges and Schools > College of Business & Law > Salford Business School > Centre for Sports Business
Journal or Publication Title: International Journal of Forecasting
Publisher: Elsevier
Refereed: Yes
ISSN: 01692070
Depositing User: H Kenna
Date Deposited: 23 Oct 2007 13:53
Last Modified: 20 Aug 2013 16:50
URI: http://usir.salford.ac.uk/id/eprint/815

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