Conference: Corporate Applications of Prediction/Information Markets (Thursday, 1 November 2007)

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I have organized a conference on corporate prediction markets which may be of interest to Midas Oracle readers. It will take place on 1 November at the Kauffman Foundation in Kansas City. All of the details are available on the conference webpage (http://people.ku.edu/~cigar/PMConf_2007/PredictionMarketsConference.html) with some background available on the conference flier (http://people.ku.edu/~cigar/PMConf_2007/PredictionMarketsConference_Flier.html). Note that this is a free conference but you should get in touch with me if you plan on attending.

The preliminary schedule is listed below:

Schedule

8:30 Registration, Coffee, Opening Remarks

9:00 Lessons from Corporate Applications of Prediction Markets

Henry Berg, Microsoft

Discussant: Robin Hanson (George Mason Department of Economics)

Christina Ann LaComb, GE (The Imagination Market- abstract is free, text is gated)

Discussant: Marco Ottaviani (Kellogg School of Management, Management and Strategy)

10:45 Coffee Break

11:00 Lessons from Corporate Applications of Prediction Markets (cont)

Dawn Keller, Best Buy (Best Buy’s TAGTRADE Market)

Discussant: Paul Rhode (Department of Economics. Eller College of Management, University of Arizona)

Bo Cowgill, Google (Putting Crowd Wisdom to Work)

Discussant: Eric Zitzewitz (Dartmouth Department of Economics)

12:30 Lunch

Keynote address: Jim Lavoie, Co-Founder and CEO, Rite-Solutions

1:45 Lessons from Prediction Market Organizers and Operators

John Delaney, Founder and CEO, Intrade

David Perry, Co-Founder and President, Consensus Point

3:00 Break (refreshments)

3:15 The Legal Playing Field

Tom W. Bell, Chapman University School of Law

Discussant: Robert E. Litan (VP Research and Policy at the Kauffman Foundation, Senior Fellow at the Brookings Institution, Director of the AEI-Brookings Joint Center on Regulatory Studies)

4:00 General Discussion

6:30 Dinner

Location TBA

Previous blog posts by Koleman Strumpf:

  • Prediction Markets in the Classroom: Inkling Markets
  • Slides of presentations from Conference on Corporate Applications of Prediction/Information Markets (1 November), Kansas City
  • Summary of Conference on Corporate Applications of Prediction/Information Markets (1 November), Kansas City
  • Reminder: Corporate Applications of Prediction Markets Conference (1 November)
  • Copernican Principle: How To Predict the End of the World
  • Win Justin’s Money? (re: Is there manipulation in the Hillary Clinton Intrade market? Redux.)
  • Is there manipulation in the Hillary Clinton Intrade market?

General Electrics internal betting exchange: The Imagination Market

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The imagination market – by Christina Ann LaComb, Janet Arlie Barnett and Qimei Pan – 2007-03-10

Information markets [= prediction markets] are typically used as prediction tools, aggregating opinions about the likelihood of future events, or as preference indicators, identifying participants’ product preferences. However, the basic information market concept is more widely applicable. In our experiment, we utilized information markets [= prediction markets] within the domains of idea generation and group decisioning. Participants were allowed to propose ideas regarding potential technology research areas- these ideas were represented as securities on a virtual financial market. Participants were able to trade shares of technology ideas over the course of 3 weeks, resulting in the market identifying the “best” idea as the highest priced security. Our findings suggest that information markets [= prediction markets] for idea generation result in more ideas and more participants than traditional idea generation techniques- however, using markets to rank ideas may be no better than other methods of idea ranking. Additional benefits include providing immediate feedback, allowing visibility of all ideas to all contributors, and being a fun mechanism for consensus building.

How can BetFair, the worlds market leader, produce such a piece of ****?

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Betting @ BetFair – The Official BetFair News Site

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&#8230- is a piece of ****.

#1. The brand name of this sub-site is crappy.

#2. The organization of the content is crappy.

#3. The content is crappy.

#4. Everything in it is totally crappy.

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My meta thoughts:

  1. The non-media, commercial companies cannot produce interesting journalistic content &#8212-unless they partner or buy out a media.
  2. Most people don&#8217-t have what it takes to be a good journalist. The blogging revolution has opened the door to many wannabe journalists, which is good&#8230- but still&#8230- only a small percentage of all the bloggers are good journalists. A good journalist is fundamentally a bastard. He/she would kill his/her mother to get the scoop, to find the right headline, to grab attention, and to advance his/her ideological hidden agenda. [*] That&#8217-s a very different mindset than executives and managers have. Journalists are a special species.
  3. As of today, it is inconceivable to publish on the Web and not to abide by the conventions and standards established by the other publishers. In other words, if you publish a group blog, it should resemble in its layout to the other group blogs &#8212-because that&#8217-s what your readers are accustomed to. Most of your readers spend most of their time elsewhere on the Web, are shaped by that experience, and then impose the conventions and standards to your website.

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[*] For instance, Mike Smithson&#8217-s hidden agenda is dual: number one, political betting has a social utility (forecasting), and, number two, the Liberal Democrats (that&#8217-s the third party in the U.K.) are good for Britain.

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Note: I was admonished by Niall O&#8217-Connor, yesterday, for using a &#8217-special&#8217- image that conveyed perfectly what I thought about this BetFair sub-site. :-D I suppressed the shocking image, to make up with the Irish betting man. He was right that it attracted attention- that blog post was the most downloaded, yesterday. :-D Rock around the bunker… Rock around, rock around… Rock around the bunker… Rock around, rock around… Rock around the bunker… Rock around, rock around…

Author Profile&nbsp-Editor and Publisher of Midas Oracle .ORG .NET .COM &#8212- Chris Masse&#8217-s mugshot &#8212- Contact Chris Masse &#8212- Chris Masse&#8217-s LinkedIn profile &#8212- Chris Masse&#8217-s FaceBook profile &#8212- Chris Masse&#8217-s Google profile &#8212- Sophia-Antipolis, France, E.U. Read more from this author&#8230-

Read the previous blog posts by Chris. F. Masse:

  • Are David Pennock’s search engine prediction markets the worst marketing disaster since the New Coke?
  • Midas Oracle is incontestably [*] the best vertical portal to prediction markets.
  • Comment spam paid by Emile Servan-Schreiber of NewsFutures-Bet2Give
  • BetFair Games needs a Swedish provider to develop its gambling offerings.
  • When Markets Beat the Polls – Scientific American Magazine
  • Robin Hanson has some fanboy in India. Great. Tiny caveat: The parroting Indian writer does not acknowledge Robin Hanson by name.
  • Molecular Nanotechnology

Risk that can be measured Vs. Uncertainty that cannot be measured

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The Freakonomics guys (on nuclear energy):

[…] The answer may lie in a 1916 doctoral dissertation by the legendary economist Frank Knight. He made a distinction between two key factors in decision making: risk and uncertainty. The cardinal difference, Knight declared, is that risk — however great — can be measured, whereas uncertainty cannot.

How do people weigh risk versus uncertainty? Consider a famous experiment that illustrates what is known as the Ellsberg Paradox. There are two urns. The first urn, you are told, contains 50 red balls and 50 black balls. The second one also contains 100 red and black balls, but the number of each color is unknown. If your task is to pick a red ball out of either urn, which urn do you choose? Most people pick the first urn, which suggests that they prefer a measurable risk to an immeasurable uncertainty. (This condition is known to economists as ambiguity aversion.) Could it be that nuclear energy, risks and all, is now seen as preferable to the uncertainties of global warming? […]

Previous: The Meaning of Probability, Class Probability, Case Probability, Betting, and Gambling

Extracting Market Predictions from Financial Data: Is the Surge Working?

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At Economist&#8217-s View, Mark Thoma draws attention to a recent paper that uses financial markets data to infer a market prediction of the likely effectiveness of the U.S. government&#8217-s &#8216-Surge&#8217- strategy in Iraq.

In &#8220-Is The &#8216-Surge&#8217- Working? Some New Facts&#8220-, MIT&#8217-s Michael Greenstone writes:

This paper shows how data from world financial markets can be used to shed light on the central question of whether the Surge has increased or diminished the prospect of today&#8217-s Iraq surviving into the future. In particular, I examine the price of Iraqi state bonds, which the Iraqi government is currently servicing, on world financial markets. After the Surge, there is a sharp decline in the price of those bonds, relative to alternative bonds. The decline signaled a 40% increase in the market&#8217-s expectation that Iraq will default. This finding suggests that to date the Surge is failing to pave the way toward a stable Iraq and may in fact be undermining it.

(HT to Alex Tabarrok at Marginal Revolution.)

Spigit – combining mathematics, technology, and subject matter experts to add relevance to online communities, for the purpose of elevating good ideas and good people.

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No GravatarSpigit:

– Spigit brings advanced metrics to social networking to create truly relevant ways of measuring user reputation and contribution.
– Spigit&#8217-s metrics give the best and brightest people and ideas a chance to shine, rather than relying on simple thumb&#8217-s up/thumb&#8217-s down measurements.
– User reputation and expert rankings determine how much &#8220-weight&#8221- a person&#8217-s votes receive. Spigit&#8217-s calculations of conversation levels, buzz and weighted ratings result in a true measure of value.

Can Spigit harvest the wisdom of crowds? Probably yes.

Previous blog posts by Chris F. Masse:

  • Robin Hanson wants to rule the world —just as CEOs and heads of states do for a living.
  • Predictify got funded… Great for those who will be hired… But is it a good thing, overall?
  • Nassim Nicholas Taleb likens modern-day financial markets to medicine in the 1800s, when going to a hospital in London or Paris multiplied your risk of death by four times, he says. Similarly, quants increase risk by deploying flawed financial tools designed to reduce it, he argues.
  • TradeSports-InTrade — Check Deposits
  • BetFair Australia fought for free trade across Australian state boundaries… and won.

The other Hanson who will change our future.

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No GravatarDavid Hanson, right, holds his son Zeno on his lap as the two look at Hansons’ Robot creation, also named, Zeno

by Associated Press Photo / Tony Gutierrez

David Hanson, right, holds his son Zeno on his lap as the two look at Hansons&#8217- Robot creation, also named, Zeno, at his office in Richardson, Texas, Thursday, Sept. 6, 2007.

Previous blog posts by Chris F. Masse:

  • Robin Hanson wants to rule the world —just as CEOs and heads of states do for a living.
  • Predictify got funded… Great for those who will be hired… But is it a good thing, overall?
  • Nassim Nicholas Taleb likens modern-day financial markets to medicine in the 1800s, when going to a hospital in London or Paris multiplied your risk of death by four times, he says. Similarly, quants increase risk by deploying flawed financial tools designed to reduce it, he argues.
  • TradeSports-InTrade — Check Deposits
  • BetFair Australia fought for free trade across Australian state boundaries… and won.

The BetFair betting blog = a piece of shit

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No Gravatar[image removed &#8212- see comments]

Via Niall O’Connor of Betting Market, the official BetFair betting blog.

#1. Unusable, unconventional layout and interface.

#2. Unsigned, crappy content.

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Kind of reinforce my view that a firm cannot become a media company unless it partners or buys out a journalistic outlet. Not everybody can be a journalist. It requires special skills.

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NEXT: How can BetFair, the world&#8217-s market leader, produce such a piece of ****?

Previous blog posts by Chris F. Masse:

  • Collective Error = Average Individual Error – Prediction Diversity
  • When gambling meets Wall Street — Proposal for a brand-new kind of finance-based lottery
  • The definitive proof that it’s presently impossible to practice prediction market journalism with BetFair.
  • The Absence of Teams In Production of Blog Journalism
  • Publish a comment on the BetFair forum, get arrested.
  • If I had to guess, I would say about 50 percent of the “name pros” you see on television on a regular basis have a negative net worth. Frightening, I know.
  • You can’t measure the usefulness of a system by how many resources it consumes.

How To Make Money With Prediction Markets

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How To Make Money With Prediction Markets

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Speculating On The Real-Money Prediction Exchanges (Betting Exchanges)

Beware that it requires skills, knowledge, wisdom and velocity to be profitable, on the long term.

– List of the main real-money and play-money prediction exchanges (betting exchanges) at Midas Oracle

– Complete list of the real-money and play-money prediction exchanges (betting exchanges) at Midas Oracle

– Complete list of the real-money and play-money prediction exchanges at CFM

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Getting Commissions From The Real-Money Prediction Exchanges (Betting Exchanges)

– BetFair – Refer and Earn

– TradeSports – Partners Program

– InTrade – Partners Program

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Getting Commissions From The Software Vendors

Information about commissions is not public, as of today. Contact the software vendors individually.

– List of the main software packages for prediction markets at Midas Oracle

– Complete list of the software packages for prediction markets at Midas Oracle

– Complete list of the software packages for prediction markets at CFM

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Consulting For The Organizations Running Internal Prediction Markets

As of today, the organizations that implement internal prediction markets (or other information aggregation mechanisms) take advice from the software vendors only.

– List of the main prediction market consultants at Midas Oracle

– Complete list of the prediction market consultants at Midas Oracle

– Complete list of the prediction market consultants at CFM

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Founding A Prediction Market Startup

Good luck to you. :-D

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Getting A Job In The Prediction Market Industry

Good luck to you. :-D

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