This also misses the time value of money; fixed heuristics don’t capture that the effect is more pronounced the further out the settlement date is (already prediction markets with 2030s settlement dates)
Pat Myron
Karma: 12
No one believes the Jesus market will resolve to Yes
That’s why I chose that market as an example of incentives being unilaterally broken in a single direction; ~everyone agrees that ~3% market won’t happen, but no one has much incentive to trade in that direction collecting >$30k USD correcting that market because that’d return lower than the risk-free rate. Both posts similarly claim interest rates are essential to understanding how much prediction markets reflect actual event probabilities, and interest rate distortion becomes more unilaterally directional the further a market should be from 50%
For the market to be trading at 16%, there need to be market participants on both sides of the trade
Assuming a market is trading.. Manifold, Kalshi, and Polymarket all display percentages on markets that have literally never had any volume, so UIs mislead those not inspecting orderbooks/volume/etc. Currently, Kalshi is the only one of those that even requires limit orders placed in the orderbook to start displaying percentages
> why would anyone buy Yes
> there’s an equal number of Yes and No shares circulating
at unequal pricing. For those heeding return rates, incentives to buy away from 50% are limited before incentives to buy towards 50%. In markets around 1%, one only needs a bit over 1.01% for more incentive than any possible return in the other direction; therefore, incentives can be unilaterally broken in a single direction:
https://polymarket.com/event/will-jesus-christ-return-in-2025
Another example: CPAP compliance/adherence rates
Further, the SAT used to be much harder. In 1991, only nine students scored a 1600, whereas people estimate that over 500 students achieve a perfect score today.
Those numbers don’t support that claim because of:
More intelligent students (Flynn effect)
Higher standardized test participation among HS students (test takers ~doubled with only >50% more students)
doesn’t track the time value of money in the global economy
(Ignoring liquidity rewards) Therefore, other platform users have access to similar lucrative return rates (Polymarket and Manifold fund liquidity without meaningful revenue) as those fireselling, so best returns may be ignoring obvious longterm markets altogether:
https://manifold.markets/Nu%C3%B1oSempere/this-question-will-resolve-positive-4a418ad86de3#jdUj58EdDXBbF8ZNyXaT
reflect true probabilities, especially for low-probability events
Polymarket could consider at least being explicit about that limitation and disallow wagers beyond 99% like Kalshi and Manifold currently do:
More annual links:
https://hntoplinks.com/year
Magnum forums like this one:
https://forum.effectivealtruism.org/allPosts?timeframe=yearly
https://lesswrong.com/allPosts?timeframe=yearly
https://progressforum.org/allPosts?timeframe=yearly
https://forum.fastcommunity.org/allPosts?timeframe=yearly
and subreddits:
https://reddit.com/r/*/top/?t=year
impressive LLM benchmark/test results seemingly overfit some datasets:
https://x.com/cHHillee/status/1635790330854526981
https://www.goodreads.com/book/show/57906379-extra-life tackles similar questions and claims fertilizers, sanitation, and vaccines saved billions of lives each:
https://www.workersliberty.org/story/2022-01-25/20000-days-history-life-expectancy
https://en.wikipedia.org/wiki/Dunning–Kruger_effect seems like a decent entry point to rabbit hole similar phenomenon
shut your phone off
Leave phones elsewhere, remove batteries, or faraday cage them if you’re concerned about state-level actors:
Studies keep showing sugar does not cause hyperactivity in children.
I assume the sugar myth is because food dye causes hyperactivity:
https://pubmed.ncbi.nlm.nih.gov/32006369/
https://ncbi.nlm.nih.gov/pmc/articles/PMC9573786/
https://ncbi.nlm.nih.gov/pmc/articles/PMC4321798/
https://pmc.ncbi.nlm.nih.gov/articles/PMC3441937/
Free static page services offer previews:
detailed limit source: https://www.fec.gov/help-candidates-and-committees/candidate-taking-receipts/contribution-limits/