The wisdom of no crowds: the reaction of betting markets to lockdown soccer games

The support of home spectators is one of the contributing factors to the home advantage effect in sports matches. The Covid-19 pandemic led to European soccer matches being played without spectators. We show that betting markets adjusted swiftly to account for a reduced home advantage in both goal difference and the probability of a win. These adjustments proved accurate over a large sample of soccer matches subsequently played without spectators even though the earliest games appeared to suggest a much bigger change in home advantage.