Journal of Economic Behavior & Organization 81 (2012) 172–184 Contents lists available at SciVerse ScienceDirect Journal of Economic Behavior & Organization j our nal ho me p age: www.elsevier.com/locate/jebo The hot hand and the cold hand in professional golf Jeffrey A. Livingston ∗ Bentley University, Department of Economics, 175 Forest Street, Waltham, MA 02138, United States a r t i c l e i n f o Article history: Received 23 April 2007 Received in revised form 28 June 2011 Accepted 4 October 2011 Available online 12 October 2011 JEL classification: D01 D81 D83 D84 Keywords: Hot hand effect Golf Law of small numbers Decision making a b s t r a c t Previous studies have shown that people believe in the existence of the “hot hand” effect: recent good performances make one more confident and lead to more good performances. However, economists have found little evidence that such an effect is present. Motivated by models of momentum from psychology, this study examines hole-by-hole performances of four types of professional golfers, which is perhaps the ideal environment to evaluate whether such an effect exists. The results show that evidence consistent with the existence of hot hand and cold hand can be masked by looking only at overall mean impacts because the existence and magnitude of the effects can vary with the player’s experience. © 2011 Elsevier B.V. All rights reserved. 1. Introduction The potential existence of the “hot hand” effect among athletes has proven to be of great interest to economists, math- ematicians and psychologists. 1 As described by Gilovich et al. (1985) in the stem paper of the literature, players have the hot hand if their performance during a particular period is significantly better than could be expected on the basis of their overall record. The interest of economists stems from the fact that people appear to believe strongly in the hot hand effect despite the fact that little evidence supports the hypothesis that it is a real phenomenon. Gilovich et al., who call this belief a “cognitive illusion,” find no evidence that a hot hand effect exists in basketball. However, they find strong evidence that basketball fans believe in the hot hand. For example, 91 percent of their sample believes that a player “has a better chance of making a shot after having just made his last two or three shots than he does after having just missed his last two or three shots.” Camerer (1989) confirmed this finding by showing that the betting behavior of gamblers on basketball games shows that they clearly believe in the existence of a strong hot hand effect. 2 However, in a comment on Camerer’s article, Brown and Sauer (1993) argue that the evidence is less clear. While the basketball betting market certainly believes that a hot hand effect exists, the data are noisy enough so that two competing hypotheses cannot be rejected: that bettors believe in a hot hand effect, but the effect does not exist; and that bettor behavior ∗ Corresponding author. Tel.: +1 781 891 2538; fax: +1 781 891 2896. E-mail address: jlivingston@bentley.edu 1 Bar-Eli et al. (2006) provide a review of the many studies that have explored whether the hot hand effect exists. 2 Explorations of whether the hot hand effects exist in several other sports have followed. Cotton and Price (2007) present a list of these works. They include Albright (1993) who studied baseball, Dorsey-Palmateer and Smith (2004) who studied bowling, Gilden and Wilson (1995) who studied putting and dart throwing, Klaassen and Magnus (2001) who study tennis, and Smith (2003) who studied horseshoes. 0167-2681/$ – see front matter © 2011 Elsevier B.V. All rights reserved. doi:10.1016/j.jebo.2011.10.001