UI Political Markets Cited For Accuracy
December 15, 2005 | Bloomberg.comBettors have been more accurate than most polls in recent elections in Canada and the U.S., according to Thomas Ross, an economics professor at the University of British Columbia's Sauder School of Business in Vancouver who runs the Internet-based UBC Election Stock Market. "Traders use the polls, but somehow they add something." Traders on the UBC exchange predicted the popular vote in the 2000 federal election more accurately than three out of four polling companies. A similar exchange at the University of Iowa beat Gallup polls in the U.S. presidential elections between 1988 and 2000 with an average error of 1.37 percentage points, wrote JOYCE BERG and ROBERT FORSYTHE, professors at the Iowa City university's school of business. In 2004, the market predicted President George W. Bush would get 50.45 percent of the popular vote, short of the actual 51.54 percent. Election markets for Germany and France also did better than polls, Berg and Forsythe found.
Contact: Robert Forsythe