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Discussion: (3 comments)

  1. Isn’t the difference partly that polls are for measuring what people want to happen, and intrade isn’t necessarily about what people want but what most people think is going to happen. In respect of having predictive value it might be more accurate, but it’s essentially testing a completely different thing. On the other hand, it shows the value of putting some “skin in the game” instead of just offering an opinion when asked. Someone should be able to manipulate this into a lesson about capitalism or something…

  2. Jeff Perren

    If I understand the numbers given, the logical conclusion is that – at best – Intrade, et al are right about half the time. That may be better than anyone else but it seems of limited value to those not betting but interested in information.

  3. We are all familiar with “push-polling,” which can be sculpted to produce a desired result by skewing the sample and framing the questions.

    I posit that a similar result can be had by loading, or over-betting, if you will, prediction markets. Depending on the size of the betting pool, a determined campaign operative might be able to force a desired upward trend in the odds for his candidate, and lower the odds for his opponent, by the simple expedient of “flooding the zone” — pumping a relatively large sum of money into the mix. If the pool is small, this maneuver would be easy and the market might thus be co-opted to reflect a favorable trend for a particular candidate.

    In the stock market, similar outcomes are made to happen by fund managers who want to pump up stock prices just before reporting quarterly results. In the case of prediction markets, a campaign manager seeking to galvanize a particular trend would not be concerned with losing money (it’s not his own money in any case) but rather with boosting his candidate’s profile with voters. Might even be cheaper than direct mail and TV.

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