EXOTIC BETTING OPPORTUNITIES, PRICING POLICIES AND THE DEMAND FOR PARIMUTUEL HORSE RACE WAGERING

Parimutuel horse race wagering has been declining steadily for the past several decades. This has resulted in lower revenues to state governments, racetracks and horsemen. To retard or reverse this trend, attempts have been made to implement a number of pricing and marketing strategies. Among these has been the introduction of a variety of exotic wagering opportunities. Over the years the number and type of exotic wagers offered has been increased. Furthermore, the prices of both straight and exotic wagers have been increased and, in addition, the price of exotic wagers has generally been set at a higher rate than that for straight wagers. The paper examines the effectiveness of these policies.