The Efficient Racing Hypothesis
by Mike Kimel
The Efficient Racing Hypothesis
Professor Sporkweather Mo of Fridgewater University has famously postulated that a driver cannot consistently achieve better than average finishes on a recklessness-adjusted basis, provided that all drivers have the same information on track and weather conditions at the start of a race.
Using decades of data on drivers who made their living racing vehicles, Professor Mo has shown that even professional drivers are unlikely to finish with a time that beats the race average during any given race. Once survivorship bias is accounted for by including those drivers unlucky enough to only have raced only a few times (due to being cut from their respective teams, injury or death) results look even worse. The belief that many racing aficionados have that any skill is involved is false, and the fact that a few drivers seem to perennially come in at the top of the ranking tables is merely a function of randomness.
This dirty little secret is even acknowledged by professional drivers themselves. Most drivers will readily explain a poor finish by pointing to bad luck. More damning, the third time he was asked about the Efficient Race Car Driver hypothesis, Salonfute Torta, winner of three consecutive Champion’s League gold laurels admitted, “Yeah. Sure. Whatever you say” before running off to avoid having to answer more probing questions.
Professor Mo’s findings have serious implications. Because drivers are efficient, any time any driver develops a racing technique that works, it will be imitated until its effect disappears. Furthermore, vehicle designers behave the same way. While they work hard to develop newer and better race cars, any improvements will be quickly imitated.
“The result is that a member of the public wishing to wager on car races cannot do better over time than placing his or her money on an index of all racers,” Professor Mo expounded, “Betting on one of the supposed ‘good racers’ based on their previous performance is something only a fool would do.”
There are, of course, the occasional detractors to Professor Mo’s Efficient Racing Hypothesis.
Pilchard McFee of Sailfish University questions whether driver performance is consistent with the Efficient Racing Hypothesis.
“All else being equal, the best drivers tend to be the ones who put in the longest hours practicing and who have the fastest reflexes. It’s actually quite simple,” McFee has stated.
“Balderdash,” was Professor Mo’s response.
Recently, a challenge has come from another direction. Professor Snidecor Flash, Dean of Cottonberry College, claims that “there are many examples of predictability that deviate from efficiency in race outcomes. For example, while drivers race around the world, they tend to do better in races run in their home country. A great example of that effect is Spads McKeegle, who never placed in the top five in a single race during his five year career outside his native Willand, yet won all three times the circuit was run in his home country. Drivers are also more likely to perform well on dates that are significant for them, such as their birthdays, or when a loved one is on his or her deathbed.”
Professor Mo dismisses this as a small and trivial effect.
But does this mean it is impossible to make money gambling on racing? Not according to Professor Mo.
“While it is impossible to pick a race’s winners, or even how well any given driver will do in any given race with any degree of confidence based on their past winning performance, on average, a driver’s performance will be average. However, the more reckless drivers can be expected to do extremely well when they are lucky, and extremely poorly when they are not lucky. Since a bet on a driver who doesn’t place at the top pays the same whether the driver comes in fourth or last, a winning strategy is to simply bet on the most reckless drivers. In other words, the expected payoff of a wager is not zero, but rather rises with the recklessness of the driver.”
Oh ouch!
From my three decades of racing taxi cabs in NYC, Chi and SF I can claim that some have demonstrably more skill. For instance while other drivers would languish if front of the bank down the hill at 18th and Castro Street, I would creep up the block towards 17th street, watching the pedestrian count down clock all the time, and pull into the bus stop just as it hit zero — got a customer half the time, the other half I was first out on the Indy 500 down Market Street. But that was the end of my career in the early 2000s.
Back in the New York in the late 1970s most yellow drivers downtown would race along in a pack and sometimes when a passenger would hail they were all going too fast and zoomed right by — but sailed right by. I was one of those who trailed along behind the pack like a pilot fish on a shark and got the passenger.
Some got it; some don’t.
To get off-topic and into economics: I left Chicago — and free rent and free cable and free use of my brother’s town car and headed for San Francisco after Chicago allowed one 30 cent hike in the meter mileage between 1991 (90 cents) and 1997 ($1.40) — at which 1990 midpoint ($1.20) Chicago started building subways to both airports, opening up unlimited livery licensing and putting on free trolleys between all the hotspots downtown (e.g., the Aquarium used to be our hottest spot outside of O’Hare …
… and adding 40% more taxicabs.
Used to be a good paying job — not to get off topic on economics.
Hogwash. Look at Schumacher or Vettel. The technique of driving a car fast cannot be imitated. If that was true, Webber would be doing as good as Vettel, yet he is not, despite the fact that they both drive the same chassis.
Likewise with Schumacher’s team-mates, none of them could match him in driving skill. Furthermore once a team identifies a driver with superior technique, they will develop the car in a direction that maximizes that particular driver’s advantages. Hence why Vettel is faster than Webber because Vettel is better at driving a car with an exhaust-blown diffusor, and the EBD has been a huge feature in development of the Red Bull chassis.
Clearly if we are talking about circle-crashing (aka NASCAR) then maybe the research is true. But I doubt any serious student of road racing, particularly F1, could make this case.
This would actually be a valid, viable theory if Professor Mo would have focused on those who bet on car racing. Racing teams use different technologies and the race track is where their theories are tested. It could also have been a good theory if he only looked at qualifying heats but in a real race drivers exhibit different abilities to manage their car depending on where they are in the field. Drafting and saving fuel and tire wear prevents an extra pit stop.
If Professor Mo would have said that race gamblers cannot achieve better than average results, most of us would agree. The best drivers and teams would have odds that reflect their past performances and rookie drivers would carry long-shot odds until they proved themselves. This is why sports gamblers don’t make money from their profession. They make money by selling their insight and methods to the weekday bettor.