Cryptocurrency: Prediction Markets vs Prediction Polls (Atanasov 2017)

[Steven Schear]

Likely that between the two, only prediction markets enable the possibility
of encouraging real-world outcomes.

On Mon, Dec 6, 2021, 4:19 AM grarpamp <grarpamp at gmail.com> wrote:

> https://papers.ssrn.com/sol3/papers.cfm?abstract_id=2660628
>
> Distilling the Wisdom of Crowds: Prediction Markets versus Prediction Polls
>
> Management Science, Early View, Forthcoming
>
> 37 Pages Posted: 15 Sep 2015 Last revised: 28 Nov 2017
> Pavel D. Atanasov
>
> Pytho LLC
> Phillip Rescober
>
> Independent
> Eric Stone
>
> Independent
> Samuel A. Swift
>
> University of California, Berkeley - Institute of Business and
> Economic Research (IBER); Tepper School of Business
> Emile Servan-Schreiber
>
> LUMENOGIC
> Philip Tetlock
>
> University of Pennsylvania
> Lyle Ungar
>
> University of Pennsylvania
> Barbara Mellers
>
> University of California, Berkeley - Marketing Group; University of
> Pennsylvania - Marketing Department
>
> Date Written: March 1, 2017
> Abstract
>
> We report the results of the first large-scale, long-term,
> experimental test between two crowd sourcing methods – prediction
> markets and prediction polls. More than 2,400 participants made
> forecasts on 261 events over two seasons of a geopolitical prediction
> tournament. Some forecasters traded in a continuous double auction
> market and were ranked based on earnings. Others submitted probability
> judgments, independently or in teams, and were ranked based on Brier
> scores. In both seasons of the tournament, last day prices from the
> prediction market were more accurate than the simple mean of forecasts
> from prediction polls. However, team prediction polls outperformed
> prediction markets when poll forecasts were aggregated with algorithms
> using temporal decay, performance weighting and recalibration. The
> biggest advantage of prediction polls occurred at the start of
> long-duration questions. Prediction polls with proper scoring,
> algorithmic aggregation and teaming offer an attractive alternative to
> prediction markets for distilling the wisdom of crowds.
>
> Keywords: Prediction, Forecasting, Prediction Markets, Crowdsourcing
>
> JEL Classification: C82, C93, D84
>
> Suggested Citation:
> Atanasov, Pavel D. and Rescober, Phillip and Stone, Eric and Swift,
> Samuel A. and Servan-Schreiber, Emile and Tetlock, Philip and Ungar,
> Lyle and Mellers, Barbara, Distilling the Wisdom of Crowds: Prediction
> Markets versus Prediction Polls (March 1, 2017). Management Science,
> Early View, Forthcoming, Available at SSRN:
> https://ssrn.com/abstract=2660628
>
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