College Football Rankings and Market Efficiency

24 Pages Posted: 10 Oct 2002

See all articles by Ray C. Fair

Ray C. Fair

Yale University - Cowles Foundation; Yale School of Management - International Center for Finance

John F. Oster

Choate Rosemary Hall

Date Written: September 2002

Abstract

The results in this paper show that various college football ranking systems have useful independent information for predicting the outcomes of games. Optimal weights for the systems are estimated, and the use of these weights produces a predictive system that is more accurate than any of the individual systems. The results also provide a fairly precise estimate of the size of the home field advantage. These results may be of interest to the Bowl Championship Series in choosing which teams to play in the national championship game. The results also show, however, that none of the systems, including the optimal combination, contains any useful information that is not in the final Las Vegas point spread. It is argued in the paper that this is a fairly strong test of the efficiency of the college football betting market.

Keywords: Football Rankings, Predictive Information

JEL Classification: C52

Suggested Citation

Fair, Ray C. and Oster, John F., College Football Rankings and Market Efficiency (September 2002). Yale ICF Working Paper No. 02-35; Cowles Foundation Discussion Paper No. 1381. Available at SSRN: https://ssrn.com/abstract=335801

Ray C. Fair (Contact Author)

Yale University - Cowles Foundation ( email )

Box 208281
New Haven, CT 06520-8281
United States
203-432-3715 (Phone)
203-432-6167 (Fax)

HOME PAGE: http://fairmodel.econ.yale.edu

Yale School of Management - International Center for Finance ( email )

Box 208200
New Haven, CT 06520
United States
203-432-3715 (Phone)
203-432-6167 (Fax)

HOME PAGE: http://fairmodel.econ.yale.edu

John F. Oster

Choate Rosemary Hall ( email )

333 Christian Street
Wallingford, CT 06492-3800
United States

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