Théo, the French trader who placed a total bet of ~$30M on Trump winning the election on Polymarket will end up making ~$48M in profit. He ended up commissioning his own polls to measure the "neighbor effect", and believed the results were mind blowing in the favor of Trump, which gave him the conviction to make the... See more

As researchers in political science and as economists, we see three enticing advantages of forecasts from prediction markets, compared with poll-based forecasts of election outcomes: 1) Markets have full coverage of outcomes. They covered all primaries and caucuses in 2016, when polls covered about 50 percent of possible contests. Similarly, for... See more

Prediction markets work because traders can see all of the standard forecast data and aggregate it along with other idiosyncratic or dispersed information about the election. Traders can aggregate polling data or follow published poll aggregates, and they can add in any other information they think is relevant.