Friday, August 15, 2008

Olympic Markets

What do the Olympics have to do with computational complexity? Not much, so while I have spent much more time watching the games than proving theorems this week I couldn't think of the right way to fit it into the blog. Until I got the following email from David Pennock yesterday.
We implemented Olympics medal count prediction on Yoopick. Since it was your idea, you now have a moral obligation to blog about it, use it, and evangelize it to all your friends. :-)
Where most prediction markets track binary events, like whether the Obama will win the election, the Facebook-plugin Yoopick, developed at Yahoo Research in New York, is a fake-money market that predicts distributions over a range like the number of points scored in a basketball game. I suggested using Yoopick to predict the distribution of medals won by county and now you too can make your predictions and win some Yootles. I hear 100 Yootles and 2 Dollars will get you a subway ride in New York.

In other Prediction Market stuff at Yahoo, Sharad Goel used Amazon's Mechanical Turk to offer 100 people three cents each to predict the probability that Obama will win. The predictions were all over the place but average them up and you get exactly the same value as Intrade. Not the first time we've seen this phenomenon and it seems hard to explain.

And don't forget to check our our Electoral Markets Map. Obama has the slight edge as we get closer to the conventions and start of the real campaign season.


  1. Their offers of bets on MLB games are seriously flawed, because they seem to be assigning a significant probability to a game being tied. For example, in tonight's Chicago Cubs-Florida game, I can put up 10 units to win 85 if that game's a tie, which is a horrible bet, since there are no ties in baseball.

    Conversely, I can put up 10 to win 14 if Florida wins, and I can put up 10 to win 10 if the Cubs win. So if I make both of those bets, and the Marlins win, I come out 4 ahead; if the Cubs win I come out even.

    This may just mean that "yootles" will become even more worthless than they currently are as time goes on...

  2. I think everyone should be watching a different sort of Olympics on TV:

    Much more compelling viewing IMO.

  3. Replying to Isabel above: Quite right, shortselling ties is free (fake) money! In fact, that's not the worst way we're hemorrhaging yootility...