, Columnist
The 'Wisdom of Crowds' Is Not That Wise
Some markets are smarter than others. Witness the Greek debacle.
Bettors are wrong a lot.
Photographer: YOSHIKAZU TSUNO/AFP/Getty ImagesI had to chuckle when I read the following on Bloomberg yesterday:
The delicious irony of a prediction market making an early payment on an incorrect prediction of a political referendum was simply too wonderful to pass up without comment. So today's column is on why predictions markets fail, and that contrary to common beliefs, the crowd often has surprisingly little wisdom.