Tuesday, February 12, 2008

Obama Overtakes Hillary in Political Futures Stock Exchange

There is growing scientific evidence that there is something better than statistical public opinion polls for predicting the outcome of elections. Scientific interest in alternatives peaked this year as many popular public opinion pollsters failed to accurately predict several key races early in the primary season. Just like Social Weather Stations, surveys are heir to the slings and arrows of outrageous random samples and quickly changing public opinion.

FORGET about Gallup/CNN/Washington Post public opinion polls for tracking the US Presidential elections! For 2008 I've been paying much more attention to the Iowa Electronic Markets:
The Iowa Electronic Markets are operated by faculty at the University of Iowa Henry B. Tippie College of Business as part of our research and teaching mission. These markets are small-scale, real-money futures markets where contract payoffs depend on economic and political events such as elections.
A recent Scientific American essay claims that political futures stock exchanges predict election outcomes better than statistical public opinion polls. The difference between the two is that the latter rely on random sampling techniques to ask people who they are likely to vote for, while futures exchanges rely on a different mechanism. Here people are wagering real money on who they think will WIN, not who they WANT to win.

Click to zoom for Political Stock Market Ticker on Obama and Clinton

ANDREW SULLIVAN points to blog post that offers an insight as to why the growing appeal of Barack Obama extends deep into the Republic Party itself and explains his significant strength in traditionally RED states. A Republican for Obama. (May I add that Hillary and Bill Clinton are nonplussed at Barack Obama's strength in BLUE states too where they ought to have won but didn't.) Andrew thinks Obama is beginning to take on the aura of inevitability. Then there is the analogy from Driftglass: Sea Biscuit vs. War Admiral.

Increasingly, the question for the Democrats has got to be: WHO is more winnable against the GOP's John McCain, whose nomination is virtually certain according to the same political stock market.

If you want to stake real dollars at IEM, they do accept MasterCard/VISA!

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