Quote:
Originally Posted by DJofSD
When looking at the different models and methods for determining the optimal withholding, it occurs to me there is a fundamental difference between those discussions and the racetrack which renders the discussion moot. The optimum price point discussion assumes a competitive landscape, i.e. a free market place in which there are multiple competitors vying for the consumer's dollar. When it comes to wagering on race horses, you have no real alternative: the various state oversight organizations set the rate of the vig, there is not another competitor within a single state to go to for a lower price, if a lower price is available.
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It is a complicated subject... Here is more. The real answer is trial and error to maximize profit, and each situation is different. But the number is real and it is up to the people who put on the show to find it, and they have not had the desire to do so, because they have been used to a monopoly... which is no more. Economics and competition will force the issue.
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Cummings Associates