The minimax bookie

A bookmaker makes a book on a horse race: he offers odds against the various horses winning the race, and gamblers accept bets at those odds when they find the odds attractive. The book at a particular time consists of the bookmaker's winnings according to the different outcomes of the race if...

Full description

Saved in:
Bibliographic Details
Published in:Journal of applied probability 1996-12, Vol.33 (4), p.1093-1107
Main Authors: Barry, Daniel, Hartigan, John A.
Format: Article
Language:English
Subjects:
Applied sciences
Approximation
Betting
Bleeding time
Book value
Bookmaking
Dynamic programming
Exact sciences and technology
Gambling
Horse racing
Increasing functions
Markov processes
Mathematical programming
Mathematics
Minimax
Operational research and scientific management
Operational research. Management science
Optimal strategies
Optimization. Search problems
Probability
Probability and statistics
Probability theory and stochastic processes
Research Papers
Sciences and techniques of general use
Studies
Citations: Items that this one cites
Items that cite this one
Online Access:Get full text
Tags: Add Tag
No Tags, Be the first to tag this record!
Description
Summary:A bookmaker makes a book on a horse race: he offers odds against the various horses winning the race, and gamblers accept bets at those odds when they find the odds attractive. The book at a particular time consists of the bookmaker's winnings according to the different outcomes of the race if the race were run at that time. We consider strategies the bookmaker might adopt when deciding how to alter his quoted odds as bets accumulate. The bookmaker is assumed to behave conservatively in the sense that he tries to minimise his expected maximum loss over all possible outcomes of the race.
ISSN:0021-9002
1475-6072
DOI:10.2307/3214988