Polls to probabilities: Comparing prediction markets and opinion polls

B-Tier
Journal: International Journal of Forecasting
Year: 2019
Volume: 35
Issue: 1
Pages: 336-350

Authors (2)

Reade, J. James (University of Reading) Vaughan Williams, Leighton (not in RePEc)

Score contribution per author:

1.005 = (α=2.01 / 2 authors) × 1.0x B-tier

α: calibrated so average coauthorship-adjusted count equals average raw count

Abstract

The forecasting of election outcomes is a hugely popular activity, and not without reason: the outcomes can have significant economic impacts, for example on stock prices. As such, it is economically important, as well as of academic interest, to determine the forecasting methods that have historically performed best. However, the forecasts are often incompatible, as some are in terms of vote shares while others are probabilistic outcome forecasts. This paper sets out an empirical method for transforming opinion poll vote shares into probabilistic forecasts, and then evaluates the performances of prediction markets and opinion polls. We make comparisons along two dimensions, bias and precision, and find that converted opinion polls perform well in terms of bias, while prediction markets are good for precision.

Technical Details

RePEc Handle
repec:eee:intfor:v:35:y:2019:i:1:p:336-350
Journal Field
Econometrics
Author Count
2
Added to Database
2026-01-29