Monday, February 18, 2008

Course Evaluations and Prediction Markets

In my graduate class "Search and the New Economy" we covered (among other topics) the concept of the "wisdom of the crowds" and the ideas behind prediction markets. As an assignment, students had to create contracts for various prediction markets and post them at the class website at [not functioning anymore as the pilot expired]

To get the site going, I created a market trying to predict the course evaluation. (I am always curious to find out how students like the class.) So far (as of February 18th) the class rating according to the weighted market prediction is 6.23/7.00. Such an evaluation will be a pretty good rating, if it is of course accurate :-). I am curious to see how accurate the result will be when the ctual evaluations are released in the next few weeks.

From 6.5 to 7.0 $36.86/ $0.00
From 6.0 to 6.5 $49.95/ $100.00
From 1.0 to 5.0 $4.23/ $0.00
From 5.0 to 5.5 $4.60/ $0.00
From 5.5 to 6.0 $4.34/ $0.00

The weighted prediction market was 6.23/7.00. The final evaluation received for the class was 6.3/7.0.