IDEAS home Printed from https://ideas.repec.org/a/buc/jpredm/v3y2009i2p78-106.html
   My bibliography  Save this article

Prediction Markets as a Medical Forecasting Tool: Demand for Hospital Services

Author

Listed:
  • David Rajakovich
  • Vladimir Vladimirov

Abstract

This paper presents the outcome of a study conducted at the Royal Devon and Exeter Hospital in which a prediction market was established in order to forecast demand for services. To the researcher's knowledge, it does not appear that prediction markets have been previously utilized in a healthcare environment. The purpose of this study is to provide evidence for the effective use of prediction markets in a healthcare environment. The study was conducted over a period of one week, and involved sixty-five participants. Each was asked to provide an estimate for demand for services at the Royal Devon and Exeter Hospital. Characteristics gathered for each participant included level of education, occupation, directorate, number of years worked for the hospital, and number of years worked for the National Health Service. The study confirms the effectiveness of prediction markets to forecast future events as overall hospital demand was forecasted with an error of only 0.3%. The prediction market was less successful in predicting demand for services for each department, which the researcher attributes to the small sample size and lack of diversity of participants. Additionally, only a very small percentage of the characteristics captured registered a statistically significant correlation with the accuracy of the estimate. Further studies should focus on different characteristics and/or use a larger sample size to either confirm or refute the existence of such characteristics. The findings of this work could potentially be used as an innovative way to augment the forecasting function for a wide range of healthcare facilities. With the preliminary success of this study to forecast demand, further research in the field is warrantedClassification-JEL: L83

Suggested Citation

  • David Rajakovich & Vladimir Vladimirov, 2009. "Prediction Markets as a Medical Forecasting Tool: Demand for Hospital Services," Journal of Prediction Markets, University of Buckingham Press, vol. 3(2), pages 78-106, August.
  • Handle: RePEc:buc:jpredm:v:3:y:2009:i:2:p:78-106
    as

    Download full text from publisher

    File URL: http://www.ingentaconnect.com/content/ubpl/jpm/2009/00000003/00000002/art00005
    Download Restriction: no

    References listed on IDEAS

    as
    1. Jana P. Fidrmuc & Marc Goergen & Luc Renneboog, 2006. "Insider Trading, News Releases, and Ownership Concentration," Journal of Finance, American Finance Association, vol. 61(6), pages 2931-2973, December.
    2. Charles Cao & Zhiwu Chen & John M. Griffin, 2005. "Informational Content of Option Volume Prior to Takeovers," The Journal of Business, University of Chicago Press, vol. 78(3), pages 1073-1109, May.
    3. Seyhun, H. Nejat, 1986. "Insiders' profits, costs of trading, and market efficiency," Journal of Financial Economics, Elsevier, vol. 16(2), pages 189-212, June.
    4. Cornell, Bradford & Sirri, Erik R, 1992. " The Reaction of Investors and Stock Prices to Insider Trading," Journal of Finance, American Finance Association, vol. 47(3), pages 1031-1059, July.
    5. Schnytzer, Adi & Shilony, Yuval, 1995. "Inside Information in a Betting Market," Economic Journal, Royal Economic Society, vol. 105(431), pages 963-971, July.
    6. Meulbroek, Lisa K, 1992. " An Empirical Analysis of Illegal Insider Trading," Journal of Finance, American Finance Association, vol. 47(5), pages 1661-1699, December.
    7. Justin Wolfers, 2006. "Point Shaving: Corruption in NCAA Basketball," American Economic Review, American Economic Association, pages 279-283.
    8. Thaler, Richard H & Ziemba, William T, 1988. "Parimutuel Betting Markets: Racetracks and Lotteries," Journal of Economic Perspectives, American Economic Association, pages 161-174.
    9. Les Coleman, 2007. "Just How Serious is Insider Trading? An Evaluation using Thoroughbred Wagering Markets," Journal of Gambling Business and Economics, University of Buckingham Press, vol. 1(1), pages 31-55, February.
    10. Camerer, Colin & Loewenstein, George & Weber, Martin, 1989. "The Curse of Knowledge in Economic Settings: An Experimental Analysis," Journal of Political Economy, University of Chicago Press, vol. 97(5), pages 1232-1254, October.
    Full references (including those not matched with items on IDEAS)

    Citations

    Citations are extracted by the CitEc Project, subscribe to its RSS feed for this item.
    as


    Cited by:

    1. Patrick Buckley & Fergal O’Brien, 0. "The effect of malicious manipulations on prediction market accuracy," Information Systems Frontiers, Springer, vol. 0, pages 1-13.
    2. Buckley, Patrick, 2016. "Harnessing the wisdom of crowds: Decision spaces for prediction markets," Business Horizons, Elsevier, vol. 59(1), pages 85-94.
    3. Riekhof, Hans-Christian & Riekhof, Marie-Catherine & Brinkhoff, Stefan, 2012. "Predictive Markets: Ein vielversprechender Weg zur Verbesserung der Prognosequalität im Unternehmen?," PFH Forschungspapiere/Research Papers 2012/07, PFH Private University of Applied Sciences, Göttingen.
    4. repec:spr:infosf:v:19:y:2017:i:3:d:10.1007_s10796-015-9617-7 is not listed on IDEAS

    More about this item

    JEL classification:

    • L83 - Industrial Organization - - Industry Studies: Services - - - Sports; Gambling; Restaurants; Recreation; Tourism

    Statistics

    Access and download statistics

    Corrections

    All material on this site has been provided by the respective publishers and authors. You can help correct errors and omissions. When requesting a correction, please mention this item's handle: RePEc:buc:jpredm:v:3:y:2009:i:2:p:78-106. See general information about how to correct material in RePEc.

    For technical questions regarding this item, or to correct its authors, title, abstract, bibliographic or download information, contact: (Victor Matheson, College of the Holy Cross). General contact details of provider: http://www.ubpl.co.uk/ .

    If you have authored this item and are not yet registered with RePEc, we encourage you to do it here. This allows to link your profile to this item. It also allows you to accept potential citations to this item that we are uncertain about.

    We have no references for this item. You can help adding them by using this form .

    If you know of missing items citing this one, you can help us creating those links by adding the relevant references in the same way as above, for each refering item. If you are a registered author of this item, you may also want to check the "citations" tab in your RePEc Author Service profile, as there may be some citations waiting for confirmation.

    Please note that corrections may take a couple of weeks to filter through the various RePEc services.

    IDEAS is a RePEc service hosted by the Research Division of the Federal Reserve Bank of St. Louis . RePEc uses bibliographic data supplied by the respective publishers.