Tuesday, April 8, 2014
Along with the book Wisdom of Crowds, Google Prediction Markets seem to be touching multiple fortune 500 companies in 2008, but a quick Google search today, it seems that except for a few pockets of interest, this “market” has mostly dried up. Moreover, one of the stock exchanges sued Intrade for hosting prediction markets on their site. Intrade’s response was to shut down the election prediction market because most of their profits would have gone to the cost of the regulatory agencies.
I could not find many instances were prediction markets were used in government, but the ease of implementation begs the question, “Why?” Software can do most of the heavy lifting. At most, managers would have to come up with the questions to allow the market to run. For the reasons discussed during the brief last Monday, government managers are dismissing a tool that could save the government millions of dollars. This is not an understatement by any stretch of the imagination.
Another course of action that was not discussed during the case is to throw out any incentive. Mandatory fun for everyone! Seriously, this could be achieved simply by writing it into a new employee’s job descriptions. Indeed, changing current employee’s job description may take some on additional headaches, but this too could be implemented. After all voting in a prediction market would take only a minute portion of an employee’s time and the benefits could be immense. Worse case is that the market fails and the organization is less a few hundred dollars for the software.
Would anyone consider implementing prediction markets in their organization if the software was easy to implement and cost less than $300?