Books Don't Bet, They Match
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Books Don't Bet, They Match
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We break down how sportsbooks function as brokers that match contracts, set prices through the point spread, and earn their living through the vig. Kevin Braig joins us to explain how law, technology, and property rights shape whether sports betting markets stay clean or slide toward corruption and bad incentives.
• five reasons people gamble, from dopamine to positive skewness
• what a sports bet is as a contract and why a book exists as a broker
• how the 11-to-10 price and the vig work in practice
• why point spreads are a pricing technology and a marketing tool
• how street-level enforcement and local political capture governed bookmaking
• why Nevada legalized betting and how phones and smartphones changed everything
• the Coasean case for clearly assigned property rights between leagues and books
• how prop bets and inside information can erode trust in games
• why extreme taxes and licensing fees raise transaction costs and distort markets
Judge Kevin Braig's book, "Bookmakers vs. Ballowners"
RH Coase, "The Problem of Social Cost"
Gustavo Dudamel's opera, "Wealth of Nations"
You can follow Mike Munger on Twitter at @mungowitz