Corrupt behavior by regulators occurs frequently and imposes costs on society. Corruption can take many forms and corrupt regulators try to hide their actions, making detection difficult. We use a unique data set to analyze variation in bet volume on Betfair, an online betting exchange, for evidence of abnormal patterns associated with specific regulators (referees) enforcing regulations in football matches. An analysis of betting on 1,251 Bundesliga 1 football matches over five seasons reveals evidence of systematically higher bet volume for two referees relative to matches officiated by all other referees, indirect evidence that corruption, in the form of match fixing, occurred. Results from a randomization experiment using Fischer exact p-values, a novel method for detecting corruption, confirm these results.
AtheyS.EcklesD.ImbensG. W.. 2016. “Exact P-values for Network Interference.” Journal of the American Statistical Association113 (521): 230–40.
2.
BernhardtD.HestonS.. 2010. “Point Shaving in College Basketball: A Cautionary Tale for Forensic Economics.” Economic Inquiry48 (1): 14–25.
3.
BoeriT.SevergniniB.. 2011. “Match Rigging and the Career Concerns of Referees.” Labour Economics18 (3): 349–59.
4.
BoeriT.SevergniniB.. 2013. “Match Rigging in Italian Professional Soccer: The Economic Determinants of Corruption.” In Match-Fixing in International Sports, 101–12. Springer.
CarpenterK. 2012. “Match-fixing: The Biggest Threat to Sport in the 21st Century?” Internacional Sports Law Review2: 13–23.
7.
ChangJ.-j.LaiC.-c.. 2002. “Is the Efficiency Wage Efficient? The Social Norm and Organizational Corruption.” Scandinavian Journal of Economics104 (1): 27–47.
8.
ChoudhuryS. 2021. “Regulation and Corruption: Evidence From the United States.” Oxford Bulletin of Economics and Statistics83 (4): 897–934.
9.
ColonnelliE.GallegoJ.PremM.. 2022. “What Predicts Corruption?” In A Modern Guide to the Economics of Crime, 345–73. Edward Elgar Publishing.
10.
DeutscherC.FrickB.GürtlerO.PrinzJ.. 2013. “Sabotage in Tournaments with Heterogeneous Contestants: Empirical Evidence From the Soccer Pitch.” The Scandinavian Journal of Economics115 (4): 1138–57.
11.
DimantE.DeutscherC.. 2019. “The Economics of Corruption in Sports: The Special Case of Doping.” In Handbook of Sports Economics, Vol. 55, Cambridge University Press.
12.
DimantE.SchulteT.. 2016. “The Nature of Corruption: An Interdisciplinary Perspective.” German Law Journal17: 53.
13.
DimantE.TosatoG.. 2018. “Causes and Effects of Corruption: What Has Past Decade’s Empirical Research Taught Us? A Survey.” Journal of Economic Surveys32 (2): 335–56.
14.
DincerO. 2024. “Does Smaller Government Mean Less Corruption?” Public Finance Review52 (6): 719–26.
15.
Di TellaR.FranceschelliI.. 2011. “Government Advertising and Media Coverage of Corruption Scandals.” American Economic Journal: Applied Economics3 (4): 119–51.
DushaE. 2015. “Intermediated Corruption.” International Economic Review56 (3): 997–1017.
18.
FeltesT. 2013. “Match fixing in Western Europe.” In Match-Fixing in International Sports: Existing Processes, edited by M. Haberfeld and D. Sheehan, 15–30. Springer.
19.
Finocchiaro CastroM.GuccioC.RomeoD.. 2024. “If You Give Bureaucrats An Inch, Will they Take a Yard? Lessons From Threshold Regulatory Reform in Italy.” Public Finance Review52 (6): 727–64.
20.
FisherR. A. 1925. Statistical Methods for Research Workers. Edinburgh: Genesis Publishing Pvt Ltd.
21.
ForrestD. 2012. “The Threat to Football From Betting-related Corruption.” International Journal of Sport Finance7 (2): 99–116.
22.
ForrestD.McHaleI.McAuleyK.. 2008. “‘Say it Ain’t so’: Betting-related Malpractice in Sport.” International Journal of Sport Finance3 (3): 156–66.
23.
ForrestD.SimmonsR.. 2003. “Sport and Gambling.” Oxford Review of Economic Policy19 (4): 598–611.
24.
FrickB.GürtlerO.PrinzJ.. 2008. “Men in Black: Monitoring and Performance of German Soccer Referees.” In Soccer: Economics of a Passion, edited by H. Dietl, E. Franck and H. Kempf, 309–22. Hofmann.
25.
GinoF.BazermanM. H.. 2009. “When Misconduct Goes Unnoticed: The Acceptability of Gradual Erosion in Others’ Unethical Behavior.” Journal of Experimental Social Psychology45 (4): 708–19.
26.
LaBrieR. A.LaPlanteD. A.NelsonS. E.SchumannA.ShafferH. J.. 2007. “Assessing the Playing Field: A Prospective Longitudinal Study of Internet Sports Gambling Behavior.” Journal of Gambling Studies23 (3): 347–62.
27.
LockwoodR. I. 2008. “The Best Interests of the League: Referee Betting Scandal Brings Commissioner Authority and Collective Bargaining Back to the Frontcourt in the NBA.” Sports Law Journal15: 137–72.
28.
ÖttingM.LangrockR.DeutscherC.. 2018. “Integrating Multiple Data Sources in Match-fixing Warning Systems.” Statistical Modelling18 (5-6): 483–504.
29.
PohlkampS. 2014. “The Impact of Referees on Match Outcomes in Professional Sports: Evidence from the German Football Bundesliga.” Working Paper. University of Hamburg.
30.
PopovS. V. 2015. “Decentralized Bribery and Market Participation.” The Scandinavian Journal of Economics117 (1): 108–25.
31.
PrestonI.SzymanskiS.. 2003. “Cheating in Contests.” Oxford Review of Economic Policy19 (4): 612–24.
32.
Rose-AckermanS.PalifkaB. J.. 2016. Corruption and Government: Causes, Consequences, and Reform. Cambridge: Cambridge University Press.
33.
RosenbaumP. R. 1984. “Conditional Permutation Tests and the Propensity Score in Observational Studies.” Journal of the American Statistical Association79 (387): 565–74.
34.
StrulikH. 2012. “Riding High: Success in Sports and the Rise of Doping Cultures.” The Scandinavian Journal of Economics114 (2): 539–74.
35.
WolfersJ. 2006. “Point Shaving: Corruption in NCAA Basketball.” The American Economic Review96 (2): 279–83.
