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The Almighty Buck

How To Stop Prediction Market Manipulation 129

Posted by timothy
from the bet-you-can't-do-it dept.
Frequent contributor Bennett Haselton is still thinking about prediction markets, and giving away money. He writes: "In an article last December I described a problem with prediction markets, where even markets with cap on betting limits could be manipulated by a single trader willing to spend a lot of money to distort the marketplace odds. So I offered a $100 cash prize to be split between readers who collectively came up with the best solution to the problem. Here's an idea that I think would work." Read on for the rest.