The central premise of ‘Gluck's Second Law,’ which states that ‘The Best Time to Bet the Favourite is in the Last Race,’ is tested. Analysis of a random sample of 1212 bets placed in offcourse betting offices throughout the UK shows that bettors on later races back horses with shorter odds; commit, to some extent, higher stakes and perform at least as well as bettors on early races. The premise underlying ‘Gluck's Second Law’ that bettors back long-shots in later races is questioned in relation to the UK offcourse betting market. Suggestions are offered for these results and avenues for further research are identified.
Get full access to this article
View all access options for this article.
References
1.
AliM. M. (1977) Probability and utility estimates for racetrack bettors. Journal of Political Economy, 85, 803–815.
2.
AschP.MalkielB. G.QuandtR. E. (1982) Racetrack betting and informed behaviour. Journal of Financial Economics, 10, 187–194.
3.
GilovichT. (1983) Biased evaluation and persistence in gambling. Journal of Personality and Social Psychology, 44, 1110–1126.
4.
IsenA. M.MeansB.PatrickR.NowickiG. P. (1982) Positive affect and decision making. In ClarkM. S.FiskeS. (Eds.), Affect and cognition. Hillsdale, NJ: Erlbaum. Pp. 243–261.
5.
KopelmanR. E.MinkinB. L. (1991) Toward a psychology of parimutuel behaviour: Test of Gluck's Laws. Psychological Reports, 68, 701–702.
6.
McGlothlinW. H. (1956) Stability of choices among uncertain alternatives. American Journal of Psychology, 69, 604–615.
7.
MetzgerM. A. (1985) Biases in betting: An application of laboratory findings. Psychological Reports, 56, 883–888.
8.
ThalerR. H.JohnsonE. J. (1990) Gambling with the house money and trying to break even: The effects of prior outcomes on risky choice. Management Science, 36, 643–660.
