Prediction Markets - Barak Obama beats John McCain
Prediction Markets - Barak Obama will Win
New from InTrade - a self-updating Obama/McCain prediction market close chart.
Even though the polls may say the election will be close, the Obama/McCain outcome shows a 20 point share gap for Obama. To see the effect on recent events, customize the chart.
Prediction Markets Podcast: Wolfers Interview
Often polls and pundits are often outperformed by a prediction market in which investors trade on the outcomes with real money. Prediction markets are a common subject of Wharton economics professor Justin Wolfers, often referenced by the authors of Freakonomics. Wolters defines Prediction Markets this way:
Prediction Markets, sometimes referred to as “information markets,” “idea futures” or “event futures”, are markets where participants trade contracts whose payoffs are tied to a future event, thereby yielding prices that can be interpreted as market-aggregated forecasts. Empirical applications show that market-generated forecasts typically outperform most moderately sophisticated benchmarks.
Other Prediction market references:
- The Institute for the Future site http://iftf.org, which follows prediction markets issues
- New York Times article.
- Video of a talk given to the New Horizons in Science Briefing
- Podcast: Review of the field of prediction markets
- Research by Justin Wolfers
- PDF, Prediction Markets in Theory and Practice, Justin Wolfers joint with Eric Zitzewitz
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