Evaluating Strange Forecasts: The Curious Case of Football Match Scorelines
36 Pages Posted: 8 Apr 2019 Last revised: 23 Dec 2019
Date Written: February 23, 2019
This study analyses point forecasts for a common set of events. These forecasts were made for distinct competitions and originally judged differently. The event outcomes were low-probability but had more predictable sub-outcomes, upon which they were also judged. Hence, the forecasts were multi-dimensional, complicating any evaluation. The events were association football matches in the English Premier League. The forecasts were of exact scoreline outcomes. We compare these with implied probability forecasts using bookmaker odds and a crowd of tipsters, as well as point and probability forecasts generated from a statistical model suited to predicting football match scorelines. From evaluating these sources and types of forecast, using various methods, we argue that regression encompassing is the most appropriate way to compare point and probability forecasts, and find that both these types of forecasts for football match scorelines generally add information to one another.
Keywords: forecasting, statistical modelling, regression models, prediction markets
JEL Classification: C53, L83, G14, G17
Suggested Citation: Suggested Citation