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Deep Throat:

I agree that the Prediction Market Industry Association (PMIA) (in its present form) is highly suspicious.

The purpose of the PMIA was to provide resume and marketing fodder for Jed, Emile and John. It’s like being president of a high school club: You don’t have to accomplish anything, but you can list your “officer” status on college applications.

As we saw, Emile has already started using it in his NewsFutures marketing. So, the project has actually been a great success for its true purposes!

Its our responsibility to call bullshit on this, and we failed. The PMIA is a fake organization, and nobody deserves any extra street-cred for “leading” or “founding” it.

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Nearly all leading academics, not known for their attraction to unanimity, have publicly supported event markets. A great majority of these academics have been supplied with Intrade market data in the past, a service that Intrade intends to continue, for all study leads to an increase in transparency and understanding of event markets. It seems that the leading event market academics make no distinction between the benefits derived from academic owned markets like Iowa Electronic Markets and commercial market platforms like Intrade.

Yet many academics, with some notable exceptions, do temper their policy prescription to suggest a “safe harbor” for academic sites where research might be more generally available. As noted above Intrade has gladly supplied its event market data, typically free of charge to most of the leading prediction market academics and their students, and we are committed to encouraging the future study of event markets by continuing to supply our event market data free of charge or at very deep discounts. The academics that study event markets do a great service in developing our understanding of the strengths and weaknesses of event markets. Some commentators suggest that market liquidity and breadth typically benefit all event market stakeholders. Thus far commercial platforms like Intrade seem to be providing the greatest depth and breadth in event markets.

As Intrade has been a staunch supporter of event market academic study, and supplies greater depth and liquidity in its event markets than any other platform, it seems strange not to be a preferred purveyor. Perhaps the predominant reason many academics have held back from advocating and treating all event markets alike is a sense that initiatives to clarify or unwind the legislation restraining the optimal development of event markets is unlikely to be achievable. It seems many academics and commentators suggest a slow bureaucratic and pragmatic caution rather than focus on the optimal result. While the optimal result may be more challenging to achieve, for consistency, for better price discovery for the benefit of all, as well as for the development of Intrade, we encourage CFTC to apply common goals, objectives and standards for all participants.

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Prediction Market Industry Association – (PMIA)

4) Lobby for a clear legal and regulatory environment conducive to the productive adoption of prediction markets by individuals, firms, and governments, and ensuring free access to these markets by traders.

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The PMIA’s first board is comprised of:

[...]
Robin Hanson (George Mason University)
Justin Wolfers (Wharton School – University of Pennsylvania)

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PMIA = a marketing vehicle for some of its founders.

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The purpose of the PMIA was to provide resume and marketing fodder for Jed, Emile and John. It’s like being president of a high school club: You don’t have to accomplish anything, but you can list your “officer” status on college applications.

As we saw, Emile has already started using it in his NewsFutures marketing. So, the project has actually been a great success for its true purposes!

Its our responsibility to call bullshit on this, and we failed. The PMIA is a fake organization, and nobody deserves any extra street-cred for “leading” or “founding” it.

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1) Create a central, standardized registry of available prediction stocks and contracts from different prediction markets. This open central resource will help demonstrate the wide coverage of available predictions, facilitate search, and make prediction market data more easily available to researchers, the media, and the public at large. Participation will be entirely voluntary, and the program will leave each publisher in complete control of the commercial terms for accessing its data.

2) Offer a directory of its members, a library of core readings, and other such resources enabling newcomers to quickly learn about the field and find their way among the various worldwide offerings.

3) Provide a consensual venue for sharing industry-relevant information and announcements, and organize regular meetings of the industry to discuss common opportunities.

4) Lobby for a clear legal and regulatory environment conducive to the productive adoption of prediction markets by individuals, firms, and governments, and ensuring free access to these markets by traders.

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Reality Check:

1. Null. No central database. The idea sucks, anyway. As for the “standard” prediction markets (a good idea, that one), only InTrade and Reality Markets participate. (NewsFutures is AWOL, even though their CEO heads the PMIA.)
2. Null. The only resources listing both “members” and “core readings” of the field of prediction markets is CFM —as of today.
3. Null. The best “venues” for live discussions on prediction markets are: Koleman Strumpf’s conference(s), the ACM WorkShops on Prediction Markets, Tim O’Reilly’s conferences (Tech:Money, CI Foo Camp, etc.), and the FIA’s conferences. The other conferences are payola conferences set up by mediocre individuals or organizations who really don’t care about prediction markets —but want to make a quick buck riding the prediction market hype.
4. Null. I’m more interested in iMEGA and RGA.

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And the PMIA does not get the key individuals: Adam Siegel and Nigel Eccles —to drop only 2 names.

The Prediction Market Industry Association is an ambulatory joke, so far.

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UPDATE: Deep Throat agrees with me.

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The Journal of Prediction Markets

Editor:
Leighton Vaughan Williams

Associate Editors:
John Delaney – CEO InTrade
Bruno Deschamps – University of Bath
Olivier Gergaud РUniversit̩ de Reims Champagne-Ardennes
Robin Hanson – George Mason University
Charles Noussair – Emory University
Marco Ottaviani – Ex-London Business School
David Paton – Nottingham University Business School
Paul Rhode – University of Arizona
Emile Servan-Schreiber – CEO NewsFutures
Michael Smith – Canterbury University
Martin Spann – University of Passau
Koleman Strumpf – University of Kansas School of Business
Justin Wolfers – University of Pennsylvania
Erik Snowberg – Stanford Graduate School of Business
Eric Zitzewitz – Stanford Graduate School of Business

I’d answer “yes” to my questions stated in the title of this post. These guys should be judged on the quality of their intellectual output —me thinks. Period.

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Prediction Market Industry Association – (PMIA):

Prediction Market Industry Association – (PMIA)

Emile Servan-Schreiber T: +1 (443) 321-2700 E: ejss@newsfutures.com
Jed Christiansen T: +44 796 358 3663 E: jed.christiansen@mercury-rac.com
John Delaney T: +353 1 6200 300 E: john.delaney@intrade.com
Robin Hanson E: rhanson@gmu.edu
Justin Wolfers E: jwolfers@wharton.upenn.edu

I can understand that some, like Niall O’Connor, have reservations on this mixing of interests, though.

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But we should judge these scholars and professionals on what they deliver —not whom they talk to, or associate themselves with.

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- Justin Wolfers in the Wall Street Journal (who did not convince Felix Salmon, who in tun did not convince me );

- Chris Masse at Midas Oracle (see Tim Harford’s new post to discover how irrational Chris Masse really is );

- Jason Ruspini in a comment here;

- Caveat Bettor on Caveat Bettor;

- and John Tierney in the New York Times (a special case I’ll blog about soon).

[UPDATE: Jonathan Kennedy.]

[UPDATE: Mike Giberson.]

[UPDATE: Eric Zitzewitz.]

[UPDATE: Cass Sunstein.]

[UPDATE: Steve Roman,]

[UPDATE: Nigel Eccles.]

[UPDATE: The Everyday Economist.]

[UPDATE: Adam Siegel of Inkling Markets.]

[UPDATE: George Tziralis.]

[UPDATE: Leighton Vaughan-Williams.]

[UPDATE: Emile Servan-Schreiber of NewsFutures.]

[UPDATE: "Thrutch".]

[UPDATE: Panos Ipeirotis.]

[UPDATE: Sean Park.]

[UPDATE: Lance Fortnow.]

[UPDATE: Jed Christiansen.]

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[*] For why the polls were wrong, see: The New York Times, Zogby, Rasmussen, Gallup… [Thanks to Emile Servan-Schreiber of NewsFutures for one link.]

Help him out here. Improve on my meager comment.

~alex

www.usableMarkets.com

PREDICTION MARKET INDUSTRY ASSOCIATION IS BORN

Monday, Oct 22, 2007

PREDICTION MARKET INDUSTRY ASSOCIATION IS BORN

Industry and thought leaders join forces to help promote and grow the field of prediction markets.

London (Oct 22 2007) – The recent Prediction Market Summit held in London, UK, concluded with the creation of an international industry association tasked with promoting awareness, education and validation for the rapidly growing field.

Participants at the summit reflected the rich international and dynamic texture of the field, including veteran industry leaders such as Hollywood Stock Exchange (US), Intrade (IRL), NewsFutures (US), and Pro:kons (AU), as well as newer entrants such as Gexid (DE), Mercury (UK), Nosco (DK) and Xpree (US). Also present were many members of the international academic community from institutions in the UK, Scandinavia, Germany, Ireland, and Japan, as well as representatives of Schlumberger, Microsoft, Nokia and other companies using or considering the use of prediction markets in the operation of their business.

The Prediction Market Industry Association (“PMIA”) will focus on initiatives that can benefit all stake-holders while not hampering the healthy competition and rapid innovation that characterizes the field. Concretely, its first priorities are to:

1) Create a central, standardized registry of available prediction stocks and contracts from different prediction markets. This open central resource will help demonstrate the wide coverage of available predictions, facilitate search, and make prediction market data more easily available to researchers, the media, and the public at large. Participation will be entirely voluntary, and the program will leave each publisher in complete control of the commercial terms for accessing its data.

2) Offer a directory of its members, a library of core readings, and other such resources enabling newcomers to quickly learn about the field and find their way among the various worldwide offerings.

3) Provide a consensual venue for sharing industry-relevant information and announcements, and organize regular meetings of the industry to discuss common opportunities.

4) Lobby for a clear legal and regulatory environment conducive to the productive adoption of prediction markets by individuals, firms, and governments, and ensuring free access to these markets by traders.

To lead the collective effort on these initiatives, the summit participants chose a five member board of directors: three from industry and two from academia. Participants immediately came to consensus on the two academic members. The three industry board members, however, were elected in a secret ballot where voters could nominate any industry player whether present at the meeting or not. The PMIA’s first board is comprised of:

Emile Servan-Schreiber (NewsFutures) Chairman
Jed Christiansen (Mercury Research & Consulting) Treasurer
John Delaney (Intrade)
Robin Hanson (George Mason University)
Justin Wolfers (Wharton School, University of Pennsylvania)

The board’s first task will be to establish the association’s bylaws, which will naturally include provisions for the regular rotation of the members of the board. A first draft will be published within the next two weeks and will be open to comment by all interested parties.

As it pursues the PMIA’s collective benefit agenda, the board looks forward to drawing heavily from the prediction market community’s extraordinarily rich and diverse pool of talent and experience. Comments, suggestions, and offers to help are most welcome. (We thank our friends at Nosco for graciously designing the association’s logo.)

As of today, the Prediction-Markets Google Group is the official discussion venue of the association. (Thanks to John Maloney for turning over the keys of this valuable resource.) This discussion group will act as the de facto virtual home of the association while this website is in construction.

In recognition of the inspiration provided by the river Thames, on the banks of which it was born, and the fact that London is both the financial capital of the world and a historical bridge between the United States and Europe, where most of the activity in the field currently takes place, the PMIA board has chosen this city as its physical home.

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For additional information contact:

Emile Servan-Schreiber T: +1 (443) 321-2700 E: ejss@newsfutures.com
Jed Christiansen T: +44 796 358 3663 E: jed.christiansen@mercury-rac.com
John Delaney T: +353 1 6200 300 E: john.delaney@intrade.com
Robin Hanson E: rhanson@gmu.edu
Justin Wolfers E: jwolfers@wharton.upenn.edu

NEXT: MIDAS ORACLE STATEMENT ON THE PREDICTION MARKET INDUSTRY ASSOCIATION

UPDATE: Their new website is born, EJSS tells us: Prediction Market Industry Association

External Link: The full list of all the industry associations at CFM.