Media Attention and Betting Markets
Journal
European Economic Review
ISSN
0014-2921
Type
journal article
Date Issued
2016
Author(s)
Abstract
This paper investigates whether biased media attention affects perceptions about future events. We use data on World Cup tournaments in alpine skiing for the period of 1992–2014 and exploit close races as a source of randomness for ranking positions. Since the allocation of media attention is skewed towards the winner and athletes on the podium, we can estimate the causal effect of media attention. Our results document that ranking schemes generate sharp discontinuities in media attention even in close competitions. However, both regression discontinuity and instrumental variables estimates reveal that biased media attention neither affects prices nor quantities in the betting market. We conduct a series of robustness tests to explore the sensitivity of our results.
Language
English
HSG Classification
contribution to scientific community
HSG Profile Area
SEPS - Quantitative Economic Methods
Refereed
Yes
Publisher
Elsevier
Volume
87
Start page
304
End page
333
Subject(s)
Division(s)
Eprints ID
248828
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Name
Legge-Schmid_EER-2016_Published-Article.pdf
Size
2.37 MB
Format
Adobe PDF
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