Levi Pérez

THE ‘WHO AND WHY’ OF LOTTERY: EMPIRICAL HIGHLIGHTS FROM THE SEMINAL ECONOMIC LITERATURE

Lotteries operate today in many countries around the world. This type of gambling is usually run by governments and is sometimes described as regressive. Lottery is an unfair bet, so explaining the purchase of lottery tickets by risk-averse consumers has been a challenge for economic theory. Lotteries can be analysed from either of two economic perspectives: as a source of public revenue or as a consumer commodity. In this paper the state of economic research on lotteries is reviewed, focusing on its main empirical findings.

The Determinants of Television Audience for Professional Cycling The Case of Spain

This research is intended to assess the determinants of the television (TV) audience in Spain for professional cycling. Our data refer to cycling races broadcast on several Spanish TV channels and make it possible to compute three different audience variables: rating, share, and number of viewers. The most original contributions of this research are the new indicators of competitive balance for cycling races that are proposed here. The outcomes show that audience ratings depend mainly on the following features: competitive balance, the type of stage and race, the nationality of the race leader, and inertial behaviors on the part of viewers.

Own‐ And Cross‐Price Elasticities For Games Within A State Lottery Portfolio

Lotto demand modeling typically focuses on a single game and evaluates whether estimated “effective price” (expected loss from buying one ticket) elasticity is consistent with net revenue maximization. However, a portfolio of several different lottery games is now usually offered to players and judging the effectiveness of agencies in generating revenue requires estimation of both cross‐price and own‐price elasticities. Here we employ data from Spain to derive elasticities. Results imply that games are under‐priced if net revenue maximization is the goal. But the cross‐price estimates suggest that the operator is successful in limiting the extent to which a large jackpot on one game cannibalizes same‐week sales of other games. The paper also analyzes the impacts from two increases in the level of entry fees introduced during the data period. These appear to have affected net revenue favorably.

Participation in Internet Gambling Markets: An International Comparison of Online Gamblers' Profiles

Despite the perception of increased participation in Internet gambling around the world, relatively little is known about the characteristics of Internet gamblers. This study examines the socioeconomic characteristics of Internet gamblers using surveys conducted in Spain, the United Kingdom, and Canada, which provide differing mixes of conventional gambling activities and also have different regulatory and socioeconomic characteristics, making the comparison of Internet gamblers across these three environments an interesting exercise. A number of interesting patterns emerge from this analysis. Internet gamblers appear to be quite heterogeneous in terms of their demographic and economic characteristics.

Are Broadcast Sporting Events of "General Interest"? A Regional Panel Data Analysis of TV Ratings for Spain's La Liga

In 1997, a law was passed in Spain that mandated that “broadcastings of general interest” be free-to-air rather than pay-per-view. Since that time, a soccer match of the Spanish First Division—considered a public benefit activity—can be viewed on a weekly basis for free throughout the regular season. The aim of this article is to determine whether a “general interest” for these free-to-air broadcastings exists. To perform the empirical analysis, a demand equation for a TV audience is estimated using a unique panel data set on a regional level, in which the dependent variable is the number of viewers of free-to-air matches in each Spanish region during the period 2008–2012. The model specifications consider whether a particular region has a team competing in the First Division and other socioeconomical and sporting variables. The results conclude that a nationwide “general interest” in free-to-air broadcasting of soccer matches, which would support Spanish law, does not exist, with the exception of matches played by Real Madrid Club de Fútbol, Fútbol Club Barcelona, and local teams.

Football pools and lotteries: substitute roads to riches?

Football pools offer an older alternative to lotto games for gamblers seeking high prizes with low stakes. The article models football pools demand in Spain over nearly 40 years. The introduction of lotto games to the market led to substantial cannibalization of the pools but, subsequently, there is no evidence that the products were substitutes when the relative value for money fluctuated. Entry fee is shown to be a determinant of demand independent of the expected loss per euro, implying that long-odds games should not be analysed as if buyers were acquiring a purely financial asset.

Guessing Who Wins or Predicting the Exact Score: Does it Make Any Difference in Terms of the Demand for Football Pools?

The development of sports economics has exploded in recent years, and this well-researched and relevant book explores some of the most critical themes. Contemporary Issues in Sports Economics examines topics that have previously received little attention in the literature, such as the determinants and social impacts of sports participation including the link to crime levels. The distinguished authors also discuss some of the less investigated aspects of professional team sports, including: • sports betting, financing and governance; • the impact of low scoring matches on competitive balance and fan appeal in European football; and • the effect on player transfers of a luxury tax on club payrolls in Major League Baseball.

Loss Aversion, Upset Preference, and Sports Television Viewing Audience Size

A growing body of research examines the effect of loss aversion (LA) on consumers’ decisions to watch or attend sporting events. Much of this research focuses on live game attendance. In contrast to the predictions of uncertainty of outcome hypothesis (UOH), loss-averse consumers prefer watching either potential upsets, or dominant performances by strong favorites, to events with uncertain outcomes. We test for LA vs. UOH effects in television viewing audience data for free over-the-air broadcasts of 304 Spanish football matches from 2008/09 to 2015/16. This setting generates substantial variation home team win probabilities because of the presence of Real Madrid CF and FC Barcelona. The results support the importance of LA/upset preferences: audience size for matches when home teams are large underdogs and when heavily favored are larger than for matches with uncertain outcomes, even when controlling for observable and unobservable factors affecting the number of viewers.

Outside of the United States: The Worldwide Availability of Sports Betting

Currently, several proposed changes in sports betting laws are being debated around the world. Despite the global expansion of sports betting opportunities, relatively little research has been done to compare different regulatory environments. Many countries have banned this gambling activity, while many others allow unlimited sports betting. This chapter offers some concise impressions of sports betting regulation worldwide and a more detailed view of some individual cases worth mentioning. Outside of the United States, sports betting appears to be popular, widely legal, and quite heterogeneous in terms of market structure and legislation. In any case, there are diverse disputes going on as to how sports betting should be changed and adapted in the next future. It appears evident that the prospective value of the sports betting market may increase, but the potential effects of expanding sports betting opportunities may have to be balanced against the negative consequences of this gambling activity.

Forecasting football match results: are the many smarter than the few?*

An empirical analysis of Spanish football betting odds is carried out here to test whether football matches final result estimates by experts (bookmakers) differ (better/worse) from those by the ‘crowd’ (football pools bettors). Examination of implied probabilities for each of the possible outcomes evidences the existence of favourite long-shot bias in the betting market for Spanish football. A further study of the accuracy of probability forecasts concludes that experts seem to be better in forecasting football results than the ‘crowd’.