But Allardyce insists referees' chief Keith Hackett must do more to punish bad tackles if he wants players to stop trying to con referees by going to ground.
"He [Pedersen] is one of many Premier League players who are guilty of diving,' the Blackburn boss told the Daily Mail.
"But the bottom line is simple enough. Until Keith Hackett decides fouls should still be given for players who manage to stay on their feet, then people will always cheat.
"I would rather he [Pedersen] did not do it at all and there can be no doubt it should have been a straightforward yellow card.
"But what about players who are dishing out fouls all the time? I would like to see them being punished, not least because it would mean those on the receiving end would not need to resort to diving.
"At the moment, when a player stays on his feet, a referee thinks "That can't have been a foul, because he's still standing. It doesn't look like a foul to me so I won't give it".
"That's where the frustration creeps in. players feel they are being denied what is due them and start wondering if there is any point trying to stay on their feet.
"They inevitably reach the conclusion that, next time there is any contact, they might as well go down."