Home » Opinion » Malcolm Gladwell, Nobel, Sam Wang, and Intrade

Malcolm Gladwell, Nobel, Sam Wang, and Intrade

Christopher Chabris, Blog, Why Malcolm Gladwell Matters (And Why That’s Unfortunate), here. Googling “Tao Proved” returns 2,430 results. Mr Chabris points out “Gladwell proved” returns a count that is double that. “Dennis Rodman Proved”  gets 111K results, so those guys have some catchup work to be as productive as The Worm, I guess.

I say good for you to everyone who doesn’t take Gladwell seriously. But the reason I take him seriously is because I take him and his publisher at their word. On their face, many of the assertions and conclusions in Gladwell’s books are clearly meant to describe lawful regularities about the way human mental life and the human social world work. And this has always been the case with his writing.

Peter Woit, Not Even Wrong, Nobel for Englert and Higgs, here.

The Higgs discovery last year was one of the great milestones of fundamental physics research and it would have been very odd for the Nobel committee Swedish Academy of Sciences to not recognize it with a prize this year. I do think though that the way they chose to do this is not ideal, for a couple reasons.

Sam Wang, Princeton Election Consortium, A draft of a paper on the Meta-analysis, here.

Dear readers, I’ve been invited to write an academic article on the Meta-analysis. I’m horribly late with it…but I do have a draft. I’d be interested in your thoughts and reactions. I’m sure I have not done justice to some important topics. The article text is here (PDF) and the figures are here (6.7 MB PDF). If you link to this, use this post. The paper is a working draft and subject to change!

Rothschild and Sethi, SSRN, Trading Strategies and Market Microstructure: Evidence from a Prediction Market, here. I watched this just prior (maybe a month) to the election there was 50K USD available to arb  every 2-3 days. It was remarkable. It was not clear to me that it was one guy moving the Intrade market.


We examine transaction-level data from Intrade’s presidential winner market for the two weeks immediately preceding the November 2012 election. The data allow us to compute key statistics, including volume, transactions, aggression, holding duration, directional exposure, margin, and profit for each of the over 3,200 unique trader accounts. We identify a diverse set of trading strategies that constitute a rich market ecology. These range from arbitrage-based strategies with low and fleeting directional exposure to strategies involving large accumulated positions in one of the two major party candidates. Most traders who make directional bets do so consistently in a single direction, unlike the information traders in standard models. We present evidence suggestive of market manipulation by a single large trader, and consider the possible motives for such behavior. Broader implications for the interpretation of prices in financial markets and the theory of market microstructure are drawn.

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