An Explanation of Optimal Each-Way Bets based on Non-Expected Utility Theory

The purpose in this paper is to demonstrate how the non-expected utility models of Markowitz and Kahneman and Tversky can explain why an agent, chooses to bet each way on a horse. We also show that that appeal to moments of return, such as a preference for skewness of return, ceteris paribus, to explain the choice of the each way gamble over the single win gamble is, in general, invalid.

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Year of publication:	2009
Authors:	Peel, David A. ; Law, Davind
Published in:	Journal of Gambling Business and Economics. - University of Buckingham Press, ISSN 1751-7990. - Vol. 3.2009, 2, p. 15-35
Publisher:	University of Buckingham Press
Subject:	MARKOWITZ UTILITY FUNCTION \| CUMULATIVE PROSPECT THEORY \| EXPO-VALUE UTILITY FUNCTION \| PROBABILITY DISTORTION \| GAMBLING

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Extent:	text/html
Type of publication:	Article
Classification:	L83 - Sports; Gambling; Recreation; Tourism
Source:	RePEc - Research Papers in Economics

Persistent link: https://www.econbiz.de/10008565803