Pre­dic­tion Markets

TagLast edit: 8 Mar 2021 4:29 UTC by Yoav Ravid

Prediction markets are speculative markets created for the purpose of making predictions. Assets are created whose final cash value is tied to a particular event or parameter. The current market prices can then be interpreted as predictions of the probability of the event or the expected value of the parameter. Prediction markets are thus structured as betting exchanges, without any risk for the bookmaker. Robin Hanson was the first to run a corporate prediction market—at Project Xanadu -, and has made several contributions to the field such as: conditional predictions, accuracy issues and market and media manipulation.

People who buy low and sell high are rewarded for improving the market prediction, while those who buy high and sell low are punished for degrading the market prediction. Evidence so far suggests that prediction markets are at least as accurate as other institutions predicting the same events with a similar pool of participants.

Predictions markets have been used by organizations such as Google, General Electric, and Microsoft; several online and commercial prediction markets are also in operation. Historically, prediction markets have often been used to predict election outcomes.

See Also

External Posts

External Links

Pre­dic­tion Mar­kets: When Do They Work?

Zvi26 Jul 2018 12:30 UTC
138 points
18 comments10 min readLW link

Limits of Cur­rent US Pre­dic­tion Mar­kets (Pre­dic­tIt Case Study)

aphyer14 Jul 2020 7:24 UTC
182 points
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Sub­si­diz­ing Pre­dic­tion Markets

Zvi17 Aug 2018 15:40 UTC
91 points
8 comments11 min readLW link

Un­known Knowns

Zvi28 Aug 2018 13:20 UTC
117 points
17 comments2 min readLW link1 review

Launch­ing Fore­cast, a com­mu­nity for crowd­sourced pre­dic­tions from Facebook

Rebecca Kossnick20 Oct 2020 6:20 UTC
110 points
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Pre­dic­tion mar­kets for in­ter­net points?

paulfchristiano27 Oct 2019 19:30 UTC
47 points
9 comments5 min readLW link

Tales from Pre­dic­tion Markets

ike3 Apr 2021 23:38 UTC
125 points
14 comments3 min readLW link

Free Money at Pre­dic­tIt?

Zvi26 Sep 2019 16:10 UTC
49 points
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The Bayesian Tyrant

abramdemski20 Aug 2020 0:08 UTC
125 points
17 comments6 min readLW link1 review

Pre­dic­tion Mar­kets Are About Be­ing Right

Zvi8 Dec 2018 14:00 UTC
82 points
7 comments7 min readLW link

Kelly bettors

DanielFilan13 Nov 2018 0:40 UTC
23 points
3 comments10 min readLW link

Help fore­cast study repli­ca­tion in this so­cial sci­ence pre­dic­tion market

rosiecam7 Aug 2019 18:18 UTC
29 points
3 comments1 min readLW link

On Robin Han­son’s Board Game

Zvi8 Sep 2018 17:10 UTC
49 points
15 comments17 min readLW link

[Question] When does adding more peo­ple re­li­ably make a sys­tem bet­ter?

jacobjacob19 Jul 2019 4:21 UTC
30 points
21 comments1 min readLW link

List of pre­vi­ous pre­dic­tion mar­ket projects

jacobjacob22 Oct 2018 0:45 UTC
32 points
2 comments1 min readLW link

Pre­dic­tIt: Pres­i­den­tial Mar­ket is In­creas­ingly Wrong

Zvi18 Oct 2020 22:40 UTC
37 points
28 comments4 min readLW link

[Question] What are good elec­tion bet­ting op­por­tu­ni­ties?

Scott Garrabrant29 Oct 2020 7:19 UTC
32 points
17 comments1 min readLW link

Time Travel Mar­kets for In­tel­lec­tual Accounting

abramdemski9 Nov 2020 16:58 UTC
38 points
7 comments7 min readLW link

In­for­ma­tion Charts

Rafael Harth13 Nov 2020 16:12 UTC
28 points
6 comments13 min readLW link

Re­s­olu­tions to the Challenge of Re­solv­ing Forecasts

Davidmanheim11 Mar 2021 19:08 UTC
57 points
13 comments5 min readLW link

The Apoca­lypse Bet

Eliezer Yudkowsky9 Aug 2007 17:23 UTC
40 points
51 comments1 min readLW link

Covid Pre­dic­tion Mar­kets at Polymarket

Zvi2 Dec 2021 12:50 UTC
39 points
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Poly­mar­ket Covid-19 1/​17/​2022

Zvi17 Jan 2022 16:10 UTC
31 points
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1001 Pre­dic­tionBook Nights

gwern8 Oct 2011 16:04 UTC
72 points
49 comments1 min readLW link

Pre­dic­tion-Aug­mented Eval­u­a­tion Systems

ozziegooen9 Nov 2018 10:55 UTC
43 points
12 comments8 min readLW link

Buy Now Or For­ever Hold Your Peace

Eliezer Yudkowsky4 Feb 2008 21:42 UTC
33 points
58 comments1 min readLW link

[LINK] Get paid to train your rationality

XFrequentist3 Aug 2011 15:01 UTC
40 points
55 comments3 min readLW link

Towards no-math, graph­i­cal in­struc­tions for pre­dic­tion markets

ryan_b4 Jan 2019 16:39 UTC
29 points
9 comments2 min readLW link

Pre­dic­tion mar­ket se­quence requested

[deleted]26 Oct 2012 10:59 UTC
39 points
45 comments2 min readLW link

Pre­dic­tive Rea­son­ing Systems

ozziegooen20 Feb 2019 19:44 UTC
26 points
2 comments5 min readLW link

Bet On Biden

deluks91717 Oct 2020 22:03 UTC
38 points
89 comments2 min readLW link

In­trade and the Dow Drop

Eliezer Yudkowsky1 Oct 2008 3:12 UTC
4 points
13 comments1 min readLW link

Real-time hiring with pre­dic­tion markets

ryan_b9 Nov 2018 22:10 UTC
17 points
9 comments1 min readLW link

Pre­dic­tion should be a sport

chaosmage10 Aug 2017 7:55 UTC
21 points
21 comments2 min readLW link

Pre­dic­tIt, a pre­dic­tion mar­ket out of New Zealand, now in beta.

Jayson_Virissimo16 Mar 2015 2:02 UTC
21 points
8 comments1 min readLW link

In­vest­ing for the Long Slump

Eliezer Yudkowsky22 Jan 2009 8:56 UTC
11 points
54 comments1 min readLW link

2011 In­trade fee changes, or, In­trade con­sid­ered no longer use­ful for LessWrongers

gwern2 Jan 2011 17:46 UTC
34 points
8 comments1 min readLW link

Pro­gram­matic Pre­dic­tion markets

whpearson25 Apr 2009 9:29 UTC
7 points
19 comments2 min readLW link

[Question] Share your per­sonal sto­ries of pre­dic­tion markets

rockthecasbah4 Nov 2020 16:09 UTC
15 points
10 comments1 min readLW link

[Question] Recom­men­da­tion for a good in­ter­na­tional event bet­ting site like pre­dic­

df fd7 Dec 2020 9:09 UTC
6 points
2 comments1 min readLW link

Pro­mot­ing Pre­dic­tion Mar­kets With Mean­ingless In­ter­net-Point Badges

1a3orn8 Feb 2021 19:03 UTC
55 points
22 comments2 min readLW link

Ex­ploit­ing Crypto Pre­dic­tion Mar­kets for Fun and Profit

Srdjan Miletic13 Mar 2021 2:31 UTC
31 points
25 comments5 min readLW link

Vio­lat­ing the EMH—Pre­dic­tion Markets

deluks91728 Mar 2021 4:05 UTC
36 points
9 comments4 min readLW link

Spec­u­la­tions Con­cern­ing the First Free-ish Pre­dic­tion Market

mike_hawke31 Mar 2021 3:20 UTC
29 points
11 comments2 min readLW link

[Question] Is Ray Kurzweil’s pre­dic­tion ac­cu­racy still be­ing tracked?

CraigMichael20 May 2021 0:06 UTC
9 points
2 comments1 min readLW link

An In­tro­duc­tion to Pre­dic­tion Markets

Annapurna14 Jun 2021 16:43 UTC
8 points
12 comments4 min readLW link

Risk Premiums vs Pre­dic­tion Markets

SimonM28 Jul 2021 23:03 UTC
32 points
6 comments6 min readLW link

Scott Alexan­der 2021 Pre­dic­tions: Mar­ket Prices—Resolution

SimonM2 Jan 2022 11:55 UTC
53 points
12 comments1 min readLW link
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