Computational Aspects of Prediction Markets
Stub. What prediction markets are, combinatorial prediction markets, automated market makers, and using markets as a distributed computation device. (AGT ch. 26)
Prediction markets as both a forecasting tool and a computational object: combinatorial prediction markets (betting on a combinatorial outcome space), automated market-maker designs that guarantee bounded loss and liquidity, and the more speculative idea of using a market’s price-discovery process as a form of distributed computation.
Outline (TODO — flesh out each)
- What is a prediction market? Background
- Combinatorial prediction markets
- Automated market makers
- Distributed computation through markets
- Open questions