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Notes -
American midterm election predictions?
Does anyone wish to use this space to register predictions for outcomes in tomorrow's American midterm elections?
Personally, I take a kind of efficient markets approach to this stuff, so I'll defer to the betting consensus. But if you want your time-stamped judgment registered as part of the official Motte record, here's your chance!
Mods - please feel free to remove if you don't think this is a good fit for the space.
The betting markets diverge quite a bit from the polling aggregation / model at FiveThirtyEight, giving greater odds of Republican victories.
Some possible reasons for market divergence:
Shy Republican / Eager Democrat effects on pollsters. Perhaps those planning to vote Republican are more likely to hide it or decline the poll, and Dems are excited to have their politics represented in the poll.
Polls may be inaccurately weighting different demographic groups.
Betters may be overeager to see Republican victories and let that influence the bets they make.
Betters are using non-polling signals like early turnout figures to inform their bets.
What else could explain the divergence between the betting markets and the polls?
I can't see how this can be squared with "and smart actors see this opportunity and place bets on the other side to drive the price back towards equilibrium" if true. Someone on the other side might want to jump on their miscalculation.
Although you can definitely argue the markets aren't fully liquid or something.
Seems likely. Possible that some of them have studied FiveThirtyEight's model and noticed factors it doesn't capture/underweights. I dunno.
How many smart actors are in political betting, anyway. I think it's mostly wishcasting by feverent partisans. It's best used as a gauge for enthusiasm of the core base. Ceremonially igniting your cash on a bonfire to signal faith in your tribe is worth something (and if you actually win, bonus!)
I bet in antiquity, people would watch the smoke rising from the temples to gauge which Babylonian cult was on the ascendency. It's much the same here.
Uhhh if that's true, then you'd expect it to attract smart actors who want to fleece said partisans.
You're basically suggesting that there's a giant pool of suckers betting thousands of dollars and somehow this hasn't attracted predators seeking easy money.
Like, you, yourself. If you strongly believe it's just partisans, why not throw some money in there betting against the crowd and reap some profits?
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