Quote:
Originally Posted by synth_floyd
The political betting markets are useless in terms of predictive ability. Whatever the conventional wisdom is will be favored. They have no special insight nor are they any more accurate than any cable news pundit just because people are putting money on the line. And if you are talking about Predictit, the odds there are often different because there are betting limits and high fees so many people who would otherwise use it, won't.
Nah. Betting markets are in line with conventional wisdom at all, unless you look at them only as a binary, who'll win. The principle bias in betting markets is a severe overestimate of the probabilities of rare events. Some of that is due to the nature of the site's vig, but people are really bad at telling the difference between a 5% event and a 0.5% event. The second is that with the low betting limits, there are a lot of people who can move the markets based on their alternative realities, or even political agendas. This dates back to at least 2008, when there were several instances of massive buys on John McCain on InTrade that shifted the market. We never really got word whether it was someone completely loony or someone trying to create positive headlines, but it was probably some of both.
Quote:
Originally Posted by Original Position
I don't, started paying close attention to them after RP was gone. Were they 20+% off polling models with high volume across all sites for weeks? Was this on InTrade?
I guess there's room to quibble about whether assigning a 10% probability to a 0.01% probability event is a larger mistake than assigning a 60% probability to a 40% probability event, but I generally think the former is the bigger mistake, and Ron Paul fandom lead to a whole lot of the former.
Quote:
Originally Posted by Original Position
My impression is that in 2016 the betting markets were better than the pundit conventional wisdom in giving Trump 15-25% to win.
The way this article reads is that the betting markets were giving Trump 15-25% to win, until after results started coming in that night. That's not especially remarkable.