I just want to point out, as a matter of principle, that figuring out the Nash equilibria in these sorts of cases is non-trivial and you can’t necc. get a good sense of them by reasoning informally. (I’m not claiming that the Nash equilibrium will be achieved in practice; it’s just, like, the simplest coherent model.)
I’m not sure if anyone has worked out the formal consequences of prediction markets in this sense! Maybe no one has! My inner-sim anticipation is that an academic studying prediction markets will not have analyzed this type of case, because it’ll have been obvious that you don’t get ‘good’ results.
I just want to point out, as a matter of principle, that figuring out the Nash equilibria in these sorts of cases is non-trivial and you can’t necc. get a good sense of them by reasoning informally. (I’m not claiming that the Nash equilibrium will be achieved in practice; it’s just, like, the simplest coherent model.)
I’m not sure if anyone has worked out the formal consequences of prediction markets in this sense! Maybe no one has! My inner-sim anticipation is that an academic studying prediction markets will not have analyzed this type of case, because it’ll have been obvious that you don’t get ‘good’ results.