From time to time I get inquiries from students who are studying and researching concepts important to behavioural economics in the context of sport. This entry might be a help in getting started on the nexus. The short list of five biases/fallacies and readings below is the largely created from email correspondences over the past few years. In time, hopefully I can flesh this out, creating a more detailed taxonomy and readings list for students. Part I below limits the concepts and readings to judgment and decision-making research.
It is important to note two points. The content below looks toward general behavioural concepts as the starting point and while some of the references here are old, they still represent important contributions. Secondly, the usual disclaimer applies - the list definitely does not intend to provide an exhaustive account of all concepts studied or papers available.
A good place to start considering a general connection between behavioural economics and sport in light of these advantages would be to consult the relatively recent paper by Pope and Schweitzer (2011) which asks Is Tiger Woods loss averse?
Pope, D. G., & Schweitzer, M. E. (2011). Is Tiger Woods loss averse? Persistent bias in the face of experience, competition, and high stakes. The American Economic Review, 101(1), 129-157.
Following on from this, here are brief and simplified explanations accompanied by some readings for specific biases/fallacies where sports data is used to investigate decision-making.
1. The Conjunction Fallacy
Erceg, N., & Galić, Z. (2014). Overconfidence bias and conjunction fallacy in predicting outcomes of football matches. Journal of Economic Psychology, 42, 52-62.
Nilsson, H., & Andersson, P. (2010). Making the seemingly impossible appear possible: Effects of conjunction fallacies in evaluations of bets on football games. Journal of Economic Psychology, 31(2), 172-180.
2. The End-of-Day Effect
Ali, M. M. (1977). Probability and utility estimates for racetrack bettors. Journal of political Economy, 85(4), 803-815.
McGlothlin, W. H. (1956). Stability of choices among uncertain alternatives. The American Journal of Psychology, 604-615.
3. The Hot-Hand Fallacy
Bar-Eli, M., Avugos, S., & Raab, M. (2006). Twenty years of “hot hand” research: Review and critique. Psychology of Sport and Exercise, 7(6), 525-553.
4. The Sunk Cost Fallacy
Borland, J., Lee, L., & Macdonald, R. D. (2011). Escalation effects and the player draft in the AFL. Labour Economics, 18(3), 371-380.
Camerer, C. F., & Weber, R. A. (1999). The econometrics and behavioral economics of escalation of commitment: a re-examination of Staw and Hoang’s NBA data. Journal of Economic Behavior & Organization, 39(1), 59-82.
Staw, B. M., & Hoang, H. (1995). Sunk costs in the NBA: Why draft order affects playing time and survival in professional basketball. Administrative Science Quarterly, 474-494.
5. The Winner’s Curse
Burger, J. D., & Walters, S. J. (2008). The existence and persistence of a winner's curse: new evidence from the (baseball) field. Southern Economic Journal, 232-245.
Cassing, J., & Douglas, R. W. (1980). Implications of the auction mechanism in baseball's free agent draft. Southern Economic Journal, 110-121.
Kahn, L. M. (1993). Free agency, long-term contracts and compensation in Major League Baseball: Estimates from panel data. The Review of Economics and Statistics, 157-164.