4 ms·

It's a prediction market - different than a pure gambling website. The prices are set in realtime by the users so there is 'wisdom of the crowd' information fo

It's a prediction market - different than a pure gambling website. The prices are set in realtime by the users so there is 'wisdom of the crowd' information for the public.

deleted 16y ago
[deleted]
axod 16y ago
"wisdom in the crowd" seems like a contradiction. Nice phrase.
- jodrellblank 16y ago
  http://en.wikipedia.org/wiki/The_Wisdom_of_Crowds http://en.wikipedia.org/wiki/The_Wisdom_of_Crowds "a book written by James Surowiecki about the aggregation of information in groups, resulting in decisions that, he argues, are often better than could have been made by any single member of the group."
  - huherto 16y ago
    Check the reference to Delphi Methods in above wikipedia link. They are used for estimating efforts in software development.
- laut 16y ago
  There's a big difference between prices emerging and a crowd that discusses a question to come up with a "group answer".
huherto 16y ago
and as far as I know they are the best mechanism to predict the outcome of an election. It's an honest opinion since they are betting their own money independently of their personal preferences.
- danparsonson 16y ago
  Are you suggesting that people will make bets in a purely rational way, and only by considering (in this case) what they know about the UK election? I suggest that plenty of people will either bet emotionally, choosing the option they prefer, or psuedo-rationally (i.e. reasoning poorly). I expect many will also use the odds provided on the website to guide their choices.
  - alextgordon 16y ago
    Possibly not a site like this. But predictions made by bookmakers should in theory be accurate, since the bookmaker has a financial incentive to make them accurate and no political incentive to misrepresent them.
  - eru 16y ago
    The irrational bettors will be driven out of the market, and made money of, by the rational punters.
  - yummyfajitas 16y ago
    If you truly believe this, why don't you take their money by betting against them?
    - danparsonson 16y ago
      Have you looked at the site? What should I bet against? There are a lot of choices :-) I don't imagine a clear divide between 'rational' and 'irrational' betting (for want of a better description), I'm just saying that I would expect there to be a lot of both going on. If you're wondering why I believe this, the book 'Predictably Irrational' by Dan Ariely springs to mind as a good read about the subject. Also 'The Tiger That Isn't' (Michael Blastland/Andrew Dilnot), not about human rationality as such but rather, how easily we can be foxed by information depending upon how it is presented to us (in the context of 'reasoning poorly' about the election).
- deleted 16y ago
  [deleted]
danparsonson 16y ago
The user pays money in the hope of winning more back - it's gambling however you slice it. There is no information of any value here outside the context of the site itself - unless you're claiming that your audience is a representative sample of the UK population?
- eru 16y ago
  That's not how prediction markets work. People aren't supposed to bet on whom they want to win. People are supposed to be searching a profit, that is find differences between the odds given in the current market and what they perceive as the true odds. People who do this consistently over time, tend to accumulate more money, and thus accrue more influence as time goes on. Also people who bet foolishly, e.g. just bet on who they like to see winning, create opportunities for other people to make money of their back.
- anamax 16y ago
  > The user pays money in the hope of winning more back - it's gambling however you slice it. That describes investment as well.
  - danparsonson 16y ago
    Indeed - what's your point? Since both generally involve using guesswork (however educated) in an attempt to increase wealth, it seems reasonable to draw a parallel between the two.
    - eru 16y ago
      Depends on what you define as gambling. E.g. playing crap or betting on fair coin-flips is decidedly different from prediction markets or investment; because everyone agrees on the probabilities already, so there's no information aggregation and discovery.
      - danparsonson 16y ago
        It's the same basic process though isn't it? Making a bet on the basis of a guess about the future. Of course, it may be a very well educated guess or just a shot in the dark, but unless you can actually correctly predict the future, there is always some element of uncertainty involved.

It's a prediction market - different than a pure gambling website. The prices are set in realtime by the users so there is 'wisdom of the crowd' information for the public.

deleted 16y ago

[deleted]

axod 16y ago

"wisdom in the crowd" seems like a contradiction. Nice phrase.

jodrellblank 16y ago
http://en.wikipedia.org/wiki/The_Wisdom_of_Crowds http://en.wikipedia.org/wiki/The_Wisdom_of_Crowds "a book written by James Surowiecki about the aggregation of information in groups, resulting in decisions that, he argues, are often better than could have been made by any single member of the group."
- huherto 16y ago
  Check the reference to Delphi Methods in above wikipedia link. They are used for estimating efforts in software development.
laut 16y ago
There's a big difference between prices emerging and a crowd that discusses a question to come up with a "group answer".

huherto 16y ago

and as far as I know they are the best mechanism to predict the outcome of an election. It's an honest opinion since they are betting their own money independently of their personal preferences.

danparsonson 16y ago
Are you suggesting that people will make bets in a purely rational way, and only by considering (in this case) what they know about the UK election? I suggest that plenty of people will either bet emotionally, choosing the option they prefer, or psuedo-rationally (i.e. reasoning poorly). I expect many will also use the odds provided on the website to guide their choices.
- alextgordon 16y ago
  Possibly not a site like this. But predictions made by bookmakers should in theory be accurate, since the bookmaker has a financial incentive to make them accurate and no political incentive to misrepresent them.
- eru 16y ago
  The irrational bettors will be driven out of the market, and made money of, by the rational punters.
- yummyfajitas 16y ago
  If you truly believe this, why don't you take their money by betting against them?
  - danparsonson 16y ago
    Have you looked at the site? What should I bet against? There are a lot of choices :-) I don't imagine a clear divide between 'rational' and 'irrational' betting (for want of a better description), I'm just saying that I would expect there to be a lot of both going on. If you're wondering why I believe this, the book 'Predictably Irrational' by Dan Ariely springs to mind as a good read about the subject. Also 'The Tiger That Isn't' (Michael Blastland/Andrew Dilnot), not about human rationality as such but rather, how easily we can be foxed by information depending upon how it is presented to us (in the context of 'reasoning poorly' about the election).
deleted 16y ago
[deleted]

danparsonson 16y ago

The user pays money in the hope of winning more back - it's gambling however you slice it. There is no information of any value here outside the context of the site itself - unless you're claiming that your audience is a representative sample of the UK population?

eru 16y ago
That's not how prediction markets work. People aren't supposed to bet on whom they want to win. People are supposed to be searching a profit, that is find differences between the odds given in the current market and what they perceive as the true odds. People who do this consistently over time, tend to accumulate more money, and thus accrue more influence as time goes on. Also people who bet foolishly, e.g. just bet on who they like to see winning, create opportunities for other people to make money of their back.
anamax 16y ago
> The user pays money in the hope of winning more back - it's gambling however you slice it. That describes investment as well.
- danparsonson 16y ago
  Indeed - what's your point? Since both generally involve using guesswork (however educated) in an attempt to increase wealth, it seems reasonable to draw a parallel between the two.
  - eru 16y ago
    Depends on what you define as gambling. E.g. playing crap or betting on fair coin-flips is decidedly different from prediction markets or investment; because everyone agrees on the probabilities already, so there's no information aggregation and discovery.
    - danparsonson 16y ago
      It's the same basic process though isn't it? Making a bet on the basis of a guess about the future. Of course, it may be a very well educated guess or just a shot in the dark, but unless you can actually correctly predict the future, there is always some element of uncertainty involved.