The Race Is On
You have to hand it to the American public – they have an insatiable appetite for politics. Not content with one Presidential election a year, they have to have at least two. As a result, betting exchanges have sprung up to meet the demand, enabling sports fans to wager on the outcome of the election. It’s an officially-recognized pastime known as ‘electoral betting’.
That isn’t to say that these wagers are limited to politics. For instance, fans can put on their fantasy baseball league rosters, with the goal of forecasting who will be the next pitcher to strike out the competition. Or, students can place bets on their peers in an effort to predict which classes will be the most captivating this year.
While it may seem strange to wagered in an election year (after all, there are only two guaranteed to occur in any given year), the practice has been going on for decades. In fact, the earliest known instance of election betting was during the 1948 Presidential race between incumbent president Harry Truman and challenger Thomas Dewey. Truman was a heavy favorite in the betting, with odds of 7/2, but Dewey upset the odds and became the next President.
Since then, the practice has only increased in popularity, perhaps due to the increased accessibility of online betting exchanges. In 2016 alone, offshore online bookmakers offer odds on more than 65 different political races, ranging from the Presidency down to individual Senate seats and House seats. There is even a bookmaker for French Presidential elections.
2016: The Year of the ‘Anti-Establishment’ Vote
If you followed the 2016 presidential election, you may be interested in the topic of electoral betting, since much of the action was on the sportsbooks. Trump’s upset victory in the race was one of the biggest election surprises of all time, and odds of 17/20 indicated that the Manhattan billionaire may have been a long shot to win the presidency. Even after the election, there were countless pundits that questioned whether or not Trump would be able to pull off such a dominating victory against all odds, particularly since Hillary Clinton won the popular vote.
What makes this year’s election different from previous years is that Clinton, the odds-on favorite in 2016, was part of the establishment, while Trump, who spent his entire life in business, was seen as an outsider. This dynamic created a sense of anti-establishment sentiment in voters, which influenced their decision to back Trump over Clinton in 2016. Had the tables been turned and Trump was the one facing landslide odds, we may never had heard of the #MAGA (Make America Great Again) movement.
The ‘Dewey Defeats Truman’ Effect’
Truman was also the victor in the 1948 election, but the upset victory in that race is what is known as the ‘Dewey Defeats Truman’ effect’. Basically, this is when one candidate defeats all odds to become president, but the election was so close that it isn’t until a few months later that the victor is clear. The 2000 election is also often cited as an example of this phenomenon, where Al Gore was the odds-on favorite to win the presidency and was the apparent result of the 2000 election until George W. Bush clinched the victory a few months later. While this may seem like a bad thing, it can also be an advantage for the underdog, giving them a surge of momentum leading up to the election.
Since these odds makers get paid for taking bets, they have an incentive to predict close elections in order to cash in on the action. As such, they may be making the odds slightly less biased in favor of the favorite, meaning that the underdog may actually have a chance at pulling off the upset.
Why Are People Putting Their Faith In This Year’s Election?
There are numerous reasons why this year’s election has attracted so much interest in the betting world. First, the two main candidates, Hillary Clinton and Donald Trump, are both highly controversial, which makes the election an interesting contrast in terms of the “lesser of two evils” vs. “hope for the best but prepare for the worst” scenarios. Also, with the rise of social media and the 24-hour news cycle, people have more access to information about candidates than ever before, leading to more educated guesses about which side of the political spectrum each candidate falls on. Finally, 2016 is the first time that a non-incumbent president will be up for election and there is a clear desire among voters to try something new. These factors may all contribute to why this year’s election is such an interesting and exciting race to bet on.
For those interested in placing a wager on the upcoming presidential election, online bookmakers provide a number of options, making it easy to find the odds you’re looking for. Just remember to keep your wager within reason. After all, you can’t bank on your fellow Americans to be rational actors.