For those of you with Wall Street Journal Online accounts, here’s an article about prediction markets regarding presidential races and this interesting excerpt:
Indeed, before polling became the accepted currency for information about likely voting results, in the 1940s, newspapers carried the latest betting odds as the most relevant source of information. Consider this Wall Street Journal report from Election Day, Nov. 7, 1916: “Odds on the election as quoted on the Curb showed a distinct tightening yesterday morning. There was a good supply of money to back both candidates, with Wilson offerings heavier than for some time past.”
Some $165 million in today’s dollars was wagered in Wall Street on the 1916 election – twice the amount spent on the election campaign itself. This suggests an active market, with known information well reflected in prices. And, indeed, Woodrow Wilson did narrowly beat Charles Evans Hughes.
“Betting odds are generally taken as the best indicator of probable results in presidential campaigns,” this newspaper explained in 1924. Numerous firms “make a business of receiving and placing bets, and many of the principal banking houses call these firms up daily to secure information on the betting trend.”
Interesting that we decided to switch to polls with their representative samples, assumed truthful responses and statistical analysis.
Thanks to Senectus for sending us the article
