A Study on Artificial Markets (Idea Futures)

from the Buying-into-an-idea dept.
Senior Associate John Smart brings our attention to a study on the predictive power of artificial markets ("The Real Power of Artificial Markets: A research study on the efficiency and forecast accuracy of market games on the Web") by a team of researchers at the NEC Research Institute. According to one of the studyís authors, the prices of securities can be thought of as the market's assessment of the probabilities of the corresponding events, and players can be as accurate in their predictions as stock-market investors. He also suggest that trend watchers could study artificial markets to spot evidence of future trends, or even create new gaming markets to collect information on particular areas of interest.

The full NEC study and a short version that appeared in the 9 February 2001 issue of Science are both available online and as Adobe Acrobat PDF files at http://artificialmarkets.com

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