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Title: Home advantage and mispricing in indoor sports' ghost games: The case of European basketball Authors:  Luca De Angelis - University of Bologna (Italy) [presenting]
James Reade - University of Reading (United Kingdom)
Abstract: Several recent studies suggest that the home advantage was - at least temporarily - reduced in ghost games due to the COVID-19 outbreak. However, the majority of these works focus on football and no contributions have been provided for indoor sports, where the effect of the support of the fans might have a stronger impact than in big stadia. We try to fill this gap by investigating the effect of ghost games in basketball with a special focus on the possible reduction of the home advantage due to the absence of spectators inside the arena. In particular, we test (i) for the reduction of the home advantage in basketball, (ii) whether such reduction tends to disappear over time, possibly due to adaptation of players/referees/coaching staff to the new environment, (iii) if the bookmakers promptly adapt to such structural change or whether mispricing was created on the betting market. The results from a large data set covering all seasons since 2004 for the ten most popular and followed basketball leagues in Europe show, on the one hand, an overall significant reduction of the home advantage of around 5\% and no evidence that suggests that this effect has softened even after more than 20 rounds; on the other hand, bookmakers appear to have anticipated such effect and priced home win in basketball matches accordingly, thus avoiding creating mispricing on betting markets.