I have no clue what “it is okay” means, so I can’t comment on that framing. From a legal (in most places) and from a common social-approval perspective, gambling is never good, but is an acceptable vice when it’s taxed and controlled at scale, or so small as to be unnoticeable.
Insurance bypasses this by framing it as “shared risk”, and generally prevents insuring things for significantly more than the loss those things bring. It’s not a free, arbitrary wager, it’s a very restricted and controlled wager that can be explained as making an adverse (to the buyer) event somewhat less painful.
In any case, the key insight behind prediction markets is crowdsourcing of probability beliefs (aka price discovery). This is a thing that insurance markets do not do. Thus, the question is answered (“because they are not comparable things”).
I have no clue what “it is okay” means, so I can’t comment on that framing. From a legal (in most places) and from a common social-approval perspective, gambling is never good, but is an acceptable vice when it’s taxed and controlled at scale, or so small as to be unnoticeable.
Insurance bypasses this by framing it as “shared risk”, and generally prevents insuring things for significantly more than the loss those things bring. It’s not a free, arbitrary wager, it’s a very restricted and controlled wager that can be explained as making an adverse (to the buyer) event somewhat less painful.
In any case, the key insight behind prediction markets is crowdsourcing of probability beliefs (aka price discovery). This is a thing that insurance markets do not do. Thus, the question is answered (“because they are not comparable things”).