BOOKMAKING

gambling practice of determining odds and receiving and paying off bets on the outcome of sporting events (particularly horse races), political contests, and other competitions. Some Commonwealth countries (including the United Kingdom, Australia, and New Zealand), Belgium, and Germany permit the open operation of bookmaking organizations. In the United States, however, there are probably several hundred thousand bookmakers, only a few thousand of whom (in Nevada, New York, and New Jersey), operate legally. In addition to horse racing in which the track odds are at least a base for bookmakers' odds, legal bookmaking concentrates on professional baseball, football, basketball, and boxing. Morning-line odds, established by legal bookmakers, are printed in the sports sections of newspapers throughout the United States. Illegally operating bookmakers established, before 1950, a national organization of expert observers who transmit their odds through a network of clearinghouses to individual bookmakers. The bookmaker seeks in every case to achieve a balanced book, one in which bettors are competing against one another, so that the bookmaker will profit whichever bettor wins. For example, if one bettor bets 6 to 5 on A and another bets 6 to 5 on B in a situation where only one can win, the bookmaker will collect twelve units and pay only eleven units no matter which bettor wins. The vagaries of individual bettors and special information acquired by certain large bettors often make a truly balanced book impossible. To protect himself, therefore, the smaller bookmaker will either limit the total amount bet on a favourite or will lay off (re-bet) with a larger bookmaker such bets as he is not prepared conveniently to pay if he loses. Laying off has led to the creation of several large and heavily capitalized bookmaking organizations that accept only bets laid off by other bookmakers. The casual bettor is thereby assured against such losses as occurred often before the 1940s, when local bookmakers, ruined by the victory of some heavily played horse or team, defaulted and vanished.