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> At that point they are no better than simply looking at the stocks (the predicted market). Are you assuming that prediction markets are only over stock price

by zodiac 8y ago

> At that point they are no better than simply looking at the stocks (the predicted market). Are you assuming that prediction markets are only over stock prices? What about a market about the winner of the next US presidential election?

gcb0 8y ago
if you have a market where I can make tons of money of it, at which point do you expect me to start contributing to PACs just to win the bet? see the problem?
- zodiac 8y ago
  Sorry, I don't understand what you're trying to say.
- hndamien 8y ago
  The thing is it is supposed to solicit insider information exactly like this. Potentially it incentivises people to change outcomes if the have the resources available, but at least we will all know in advance.
- AznHisoka 8y ago
  What’s the problem? Public companies with the majority of shares owned by the executives have this same incentive.
dragonwriter 8y ago
> What about a market about the winner of the next US presidential election? IIRC, those exist, were the focus of attention a few cycles back (because cherry picked just right they were arguably better than polling in the cycle preceding the attention), but as soon as media started paying attention to them, people started diverting money to them to manipulate the results, because there are plenty of people that care more about influencing the result of that question (and it's one where perceived likelihood influences the actual behavior that controls the result) more than predicting it. That kind of thing is actually a significant problem in many of the areas where prediction markets have been hyped.
- sien 8y ago
  That's a big claim. What's the evidence for people putting in large amounts of money to influence betting on elections? Isn't it making a bit assumption that people vote in a certain way because they see things in prediction markets? Regular people are surely not checking odds on who is likely to win an election.
  - dragonwriter 8y ago
    > What's the evidence for people putting in large amounts of money to influence betting on elections? Going back and reviewing things it seems my memory was wrong: the risk of coordinated efforts of this type if the prediction markets became seen as strong bellwethers of electoral success was discussed in the wake of some isolated, apparently single-trader incidents that momentarily moved the prediction markets in 2004 and again in 2008, but there doesn't appear to have been any detected widespread manipulation. > Isn't it making a bit assumption that people vote in a certain way because they see things in prediction markets? No, there's a pretty strong well-known effect that media coverage of electoral momentum reinforces that momentum; it's not doing much changing cited as impacting enthusiasm and turnout. > Regular people are surely not checking odds on who is likely to win an election. People—especially the people who are reasonably likely to vote—to consume political news, including news relating to whatever the media sees as strong horserace indicators. For a few cycles startibg around 2000 that had started including prediction markets, though it seems to have faded the last couple cycles.

by zodiac 8y ago

gcb0 8y ago

if you have a market where I can make tons of money of it, at which point do you expect me to start contributing to PACs just to win the bet? see the problem?

zodiac 8y ago
Sorry, I don't understand what you're trying to say.
hndamien 8y ago
The thing is it is supposed to solicit insider information exactly like this. Potentially it incentivises people to change outcomes if the have the resources available, but at least we will all know in advance.
AznHisoka 8y ago
What’s the problem? Public companies with the majority of shares owned by the executives have this same incentive.

dragonwriter 8y ago

> What about a market about the winner of the next US presidential election? IIRC, those exist, were the focus of attention a few cycles back (because cherry picked just right they were arguably better than polling in the cycle preceding the attention), but as soon as media started paying attention to them, people started diverting money to them to manipulate the results, because there are plenty of people that care more about influencing the result of that question (and it's one where perceived likelihood influences the actual behavior that controls the result) more than predicting it. That kind of thing is actually a significant problem in many of the areas where prediction markets have been hyped.

sien 8y ago
That's a big claim. What's the evidence for people putting in large amounts of money to influence betting on elections? Isn't it making a bit assumption that people vote in a certain way because they see things in prediction markets? Regular people are surely not checking odds on who is likely to win an election.
- dragonwriter 8y ago
  > What's the evidence for people putting in large amounts of money to influence betting on elections? Going back and reviewing things it seems my memory was wrong: the risk of coordinated efforts of this type if the prediction markets became seen as strong bellwethers of electoral success was discussed in the wake of some isolated, apparently single-trader incidents that momentarily moved the prediction markets in 2004 and again in 2008, but there doesn't appear to have been any detected widespread manipulation. > Isn't it making a bit assumption that people vote in a certain way because they see things in prediction markets? No, there's a pretty strong well-known effect that media coverage of electoral momentum reinforces that momentum; it's not doing much changing cited as impacting enthusiasm and turnout. > Regular people are surely not checking odds on who is likely to win an election. People—especially the people who are reasonably likely to vote—to consume political news, including news relating to whatever the media sees as strong horserace indicators. For a few cycles startibg around 2000 that had started including prediction markets, though it seems to have faded the last couple cycles.