Globalisation and Efficiency in the Fixed-odds Soccer Betting ... - Istituti

participants in the market may choose between possible bets not primarily in terms of their value
as financial assets but as consumer goods complementary to the sport itself. This has led to a
tendency to search for, but not explain, biases in the odds and has perhaps limited the dimensions
of bias for which empirical evidence has been sought.
Kuypers (2000) is an exception to the extent that he (importantly) sought to build a model
where a profit maximising bookmaker sets (fixed) odds in the context of a market where there is
a mixture of ‘neutral’ bettors (who share the (objectively correct) bookmaker assessment of the
probabilities attached to each possible outcome from the match) and ‘committed’ bettors (whose
views are coloured by their support for a particular team and are over-optimistic with regards to
its probability of a win). This appears a useful framework to represent the soccer betting market
though we prefer to think of the ‘fan’ bettors as capable of assessing win-probabilities
objectively even though behaving as if they had misperceptions: we interpret their willingness to
wager as taking account of utility obtained from ‘supporting’ their team in the betting market as
well as in the stadium.
In his numerical example, Kuypers has ten supporters who have decided to bet and will
wager on a particular outcome according to their perception of the value offered by each of the
(three) possible bets. Four of the bettors are neutral and six are fans of Manchester United,
Britain’s most heavily supported club. Their opponents in Kuyper’s hypothetical match are
Liverpool. He has no committed Liverpool fans in the betting market but this is not damagingly
unrealistic to the extent that the same results would have been obtained had he posited a mix of
committed fans whose average assessment of a Manchester United victory was over-optimistic.
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