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by diognesofsinope
584 days ago
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Vegas and prediction markets consistently had Trump as the favorites. Polling companies are in the business of media deals and government contracts. They will develop methodology and reporting to that end and the money is in "a close and contested race", even if it won't be. |
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Of course, if we want to assess which methodology is more accurate, we'll need more than two cherry-picked examples.
Methodologically, prediction markets are nonrandom sampling from a pool of self-selected rich people (those with sufficient discretionary income to place bets), tempered by several influences, among which profit motive is only one. See the case of assassination markets for potential confounding factors:
<https://en.wikipedia.org/wiki/Assassination_market>
And from what I'm familiar with in other forms of gaming, gamblers often lose, and often bigly.
There is some research on the question:
David M. Rothschild, "Forecasting Elections: Comparing Prediction Markets, Polls, and Their Biases", January 2009, Public Opinion Quarterly 73(5). DOI:10.1093/poq/nfp082
<https://www.researchgate.net/publication/228306045_Forecasti...>
Joyce E. Berg, Forrest D. Nelson, Thomas A. Rietz, "Prediction market accuracy in the long run" International Journal of Forecasting, Volume 24, Issue 2, April–June 2008, Pages 285-300 <https://doi.org/10.1016/j.ijforecast.2008.03.007>
"A model incorporating markets that allow betting on elections suggests a role in prognostications" (31 October 2024) <https://anderson-review.ucla.edu/prediction-markets-polls-ec...>
Referencing Mikhail Chernov, Vadim Elenev, and Dongho Song, "The Comovement of Voter Preferences: Insights from U.S. Presidential Election Prediction Markets Beyond Polls" (28 October 2024) <https://anderson-review.ucla.edu/wp-content/uploads/2024/10/...> (PDF).