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Prediction Markets – A literature review 2014

Open access
Horn, Christian Franz, Ivens, Bjoern Sven, Ohneberg, Michael, Brem, Alexander·2014·The Journal of Prediction Markets
DOI 10.5750/jpm.v8i2.889
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Abstract

In recent years, Prediction Markets gained growing interest as a forecasting tool among researchers as well as practitioners, which resulted in an increasing number of publications. In order to track the latest development of research, comprising the extent and focus of research, this article provides a comprehensive review and classification of the literature related to the topic of Prediction Markets. Overall, 304 relevant articles, published in the timeframe from 2007 through 2013, were identified and assigned to a herein presented classification scheme, differentiating between descriptive works, articles of theoretical nature, application-oriented studies and articles dealing with the topic of law and policy. The analysis of the research results reveals that more than half of the literature pool deals with the application and actual function tests of Prediction Markets. The results are further compared to two previous works published by Zhao, Wagner and Chen (2008) and Tziralis and Tatsiopoulos (2007a). The article concludes with an extended bibliography section and may therefore serve as a guidance and basis for further research. (250 WORDS)

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  • Prediction markets have been successfully used in several other fields such as sports, entertainment, and politics.

    “Prediction markets have also been successfully used in several other fields such as sports, entertainment, and politics ( 25 , 59-62 ).”

    From Evaluating replicability of laboratory experiments in economics (2016) · cites this paper as [62]

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2 of the 253 references couldn’t be matched to a known paper.

Research works printed but not linked: 56

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  3. J E Berg, J Geweke and T A Rietz "Memoirs of an indifferent trader" (2010) 1 Quantitative economics : QE ; journal of the Econometric Society 163.
  4. M Berneburg "Prediction Markets" (2008) 59 Jahrbuch für Wirtschaftswissenschaften: review of economics 60.
  5. R Borghesi "Price biases in a prediction market" (2007) 1 The Journal of Prediction Markets 233.
  6. S-H Chen and Y-L Hsieh "Reinforcement learning in experimental asset markets" (2011) 37 Eastern Economic Journal 109.
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  9. S Cherry "Bet on IT!" (2007) 44 IEEE Spectrum 48.
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  11. P R Cleary "Predicting the Taxation of Prediction Markets" (2008) 27 Virginia Tax Review 953.
  12. L Coleman "The predictive ability of financial markets" in L Vaughan Williams Prediction Markets: Theory and Applications. (London: Routledge, 2011) p111.
  13. K Croxson "Information markets for decision making: performance and feasibility" in L Vaughan Williams Prediction Markets: Theory and Applications. (London: Routledge, 2011) p52.
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  15. P Drovak "Best Buy Taps 'Prediction Market'" (2008) 252 Wall Street Journal Eastern Edition B1-B8-B8.
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  22. R Hahn and P Tetlock "When Gambling Is Good" (2007) 249 Wall Street Journal Eastern Edition A10.
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  24. K Kalovcova "A Prediction Market for Applications" Dissertation, Essays on Prediction and Betting Markets, Center for Economics Research and Graduate Education, University of Prague.
  25. K Kalovcova "Prediction vs Betting Markets" Dissertation, Essays on Prediction and Betting Markets, Center for Economics Research and Graduate Education, University of Prague.
  26. C Kaufman-Scarborough, M Morrin and E T Bradlow "Improving the crystal ball" (2010) 4 Journal of Research in Interactive Marketing: Interactive Marketing and Computer-mediated Communication 30.
  27. J Kronholz "Prediction Traders Put Their Money on Obama" (2008) 251 Wall Street Journal (Eastern Edition) A8.
  28. D S Lee and E Moretti "Bayesian learning and the pricing of new information" (2009) 99 American Economic Review 330.
  29. S Luckner and C Weinhardt "How to pay traders in information markets" (2007) 1 The Journal of Prediction Markets 147.
  30. I Marinovic, M Ottoviani andP N Sorensen "Modelling idea markets: Between beauty contests and prediction markets" in L Vaughan Williams Prediction Markets: Theory and Applications. (London: Routledge, 2011) p4.
  31. C Noussair "Experimental prediction and pair-mutuel betting markets" in L Vaughan Williams Prediction Markets: Theory and Applications. (London: Routledge, 2011) p174.
  32. P O'Connor and F Zhou "The tradesports NFL prediction market" (2008) 2 The Journal of Prediction Markets 45. 117
  33. A Oikonomidis, J Johnson "Who can beat the odds? The case of football betting reviewed" in L Vaughan Williams Prediction Markets: Theory and Applications. (London: Routledge, 2011) p204.
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  37. R J Paul and A P Weinbach "Sportsbook behavior in the NCAA football betting market" (2009) 3 The Journal of Prediction Markets 21.
  38. RJ Paul, AP Weinbach "Uses of sports wagering-based prediction markets outside of the world of gambling" in L Vaughan Williams Prediction Markets: Theory and Applications. (London: Routledge, 2011) p157.
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  55. S Stathel, S Luckner, F Teschner, C Weinhardt, A Reeson and S Whitten "AKX -An Exchange for Predicting Water Dam Levels in Australia" in I N Athanasiadis, P A Mitkas, A E Rizzoli and J Marx Gomez (eds) Information Technologies in Environmental Engineering, Environmental Science and Engineering. (Berlin Heidelberg New York: Springer, 2009) p78.
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Authors
Horn, C. F., Ivens, B. S., Ohneberg, M., & Brem, A.
Affiliations
  • University of Bamberg (DE)
  • University of Southern Denmark (DK)
ORCID
Brem, Alexander
Venue
The Journal of Prediction Markets
Publisher
University of Buckingham Press
Published
2014-09-23
Volume
8
Issue
2
Pages
89-126
ISSN
  • 1750-6751 (ISSN-L)
  • 1750-676X
DOI
10.5750/jpm.v8i2.889
OpenAlex
W1535792892
Cited by
25
References
253
Citations by year
2026: 1 · 2025: 1 · 2024: 2 · 2023: 1 · 2022: 1 · 2021: 4 · 2018: 5 · 2017: 4 · 2016: 4 · 2015: 2
FWCI
8.29
Type
journal article
Language
en
Open access
Licence
other-oa
Locations
  • The Journal of Prediction Markets (publishedVersion)
  • University of Southern Denmark Research Portal (University of Southern Denmark) (submittedVersion, other-oa)
Topics
  • Social Sciences › Economics, Econometrics and Finance › Economics and Econometrics › Sports Analytics and Performance
  • Social Sciences › Decision Sciences › Management Science and Operations Research › Forecasting Techniques and Applications
  • Social Sciences › Decision Sciences › General Decision Sciences › Decision-Making and Behavioral Economics
Keywords
prediction markets, forecasting, research classification

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