Predict the following:
- How long will Michael Vick’s prison sentence be?
- How many iPhones will Apple sell by year’s end?
- How much will Hillary Clinton raise in funds during the fourth quarter of 2007?
How accurate is the crowd? Futures markets have done a good job at predicting how the market will go for certain commodities. This fact inspired DARPA (the Defense Advanced Research Projects Agency) to create a project that sought to build a futures market around terrorism. People would be able to bid on where and when terrorist events would occur (or be attempted). The public backlash from this idea was enormous. Senator Barbara Boxer raised quite the furor and demanded that the then Information Awareness Office director Admiral John Poindexter be fired. He did lose his job over the affair, but like most Washington insiders, soon found a job on a board of directors.
I actually don’t think the Policy Analysis Market (as it was called) was such a bad idea. It seemed that the three main critcisms against it were
- it would encourage bidders to actually encourage terrorist acts in order to earn payoffs
- it’s grotesque and immoral
- pure vitriol
As for point (1), I can kinda see where they’re coming from. That would definitely be a bad side effect if it were to occur. However, I think the fact that the government knows exactly who is bidding on what, it’s also very dangerous for that person. Also, the thing had $8 million in funding. Not exactly winning the lottery considering that that money had to be spread around creating the system and as a payoff for each particular security to be traded. It was basically an advanced tip service that takes advantage of collective wisdom. Point (2) I’m also not so sure about, since we’re only talking speculation here. Is it immoral for me to predict that another soldier will die in Iraq tomorrow? I’d argue instead that the market, if it did anything at all, would save lives. And as for (3), the level of outrage coming from Senators Boxer and Wyden at the time (this all happened back in 2003) was disgusting. You’d think that DARPA had suggested we start using our babies as a food source.
I could see a worst case scenario cropping up if such a market existed, though. What would happen if this market suddenly predicted that Iran would launch a nuclear attack on American troops in Iraq (or a conventional attack for that matter)? If the market had experienced success before and gained some credibility, this could be considered a justification for war. That would be a very bad thing indeed.
So anyhow, after meandering way off point on a 4-year-old digression, let me come back around to my main point: Predictify. This is a new website that seeks to capitalize on crowd wisdom by predicting events ranging from the mundane to the presidential election. Users can predict outcomes for free and premium users can post polls that collect extra demographics from the users. Certain polls come with prize pots ranging in the hundreds of dollars.
After playing around a bit and making a few predictions, I’ve found it mildly interesting. There are slight problems with the interface. For example, if you’re browsing political predictions and submit a prediction, you’re presented with a link to go back to predicting. This link takes you back to the main page rather than the subtopic you were just at. I found this to be annoying since I had to go back to browsing the topic. Also, the top polls on the main page are starting to get slightly spammy. Predict the outcome of some motorcross race in Las Vegas this weekend for example. Predict the yearly earnings of some company no one has ever heard of. Predict how many speed dates SpeedDates.com will have by the end of the year.
I think Predictify will have to do something to prevent this sort of detritis from clogging up the site. The interesting polls that will bring in the visitors are getting lost in the clutter of these junk pedalers.