InTrade was not able to predict the elimination of Osama Bin Laden. – [PREDICTION POST-MORTEM]

I already blogged about the big fail of the prediction markets. Here&#8217-s more from the NYT, Eddy Elfenbein, and Barry Ritholtz.

4 thoughts on “InTrade was not able to predict the elimination of Osama Bin Laden. – [PREDICTION POST-MORTEM]

  1. Caveat Bettor said:

    This is a big miss. But what is the benchmark? What prediction alternatives did better? Just because something is useless some of the time doesn’t mean it is useless all of the time.

  2. Chris F. Masse said:

    You’re right. In fact, if you follow my link, you understand that I contrast this fail with Hanson and Wolfers’s expectations sold to the public.

  3. Paul Hewitt said:

    The market participants had very little, if any, information upon which to make an informed prediction. There were some people who had good information, but they were the SEALs involved with the raid (perhaps a bit too busy to make a trade) and those in the Situation Room, none of which appear to have logged onto Intrade.

    The Intrade market shows that the market did respond…once it was obvious what the outcome would be. I guess that’s a good sign of the market efficiency, but it also shows that Intrade shouldn’t even have bothered to set up the market. No one “in the know” was going to trade, and those that did knew nothing.

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