Glenn Reynolds (Instapundit) blogged about the DARPA project controversy:
THE PENTAGON WANTS TO USE A FUTURES MARKET
<http://nytimes.com/2003/07/29/politics/29TERR.html> to predict terror
attacks. Although this is getting a lot of criticism (mostly from
members of Congress who, I suspect, couldn't accurately describe the
operation of /existing/ futures markets) I think it's an excellent
example of creative thinking, and the Pentagon deserves to be
congratulated for it. As I've suggested before (here
<http://www.techcentralstation.com/1051/defensewrapper.jsp?PID=1051-350&CID=1051-041603A>,
here,
<http://www.techcentralstation.com/1051/defensewrapper.jsp?PID=1051-350&CID=1051-021203A>
and especially here
<http://techcentralstation.com/1051/techwrapper.jsp?PID=1051-250&CID=1051-103002A>)
the diffuse, fast-moving threat of terrorism requires a diffuse,
fast-moving response. And this sounds like a very plausible way of
recruiting a lot of minds in the service of anti-terrorism.
Josh Chafetz agrees:
<http://www.oxblog.blogspot.com/2003_07_27_oxblog_archive.html#105943317047655345>
A futures market in terrorist attacks, while it sounds grisly, may
help us to aggregate diffuse knowledge in a way that will prove
superior to expert knowledge. It also may not, but it seems to me
that it's worth a try. At the very least, if we're going to demand
that the government get creative in fighting terror, we shouldn't be
so quick to criticize when it does just that.
Yep.
UPDATE: Reader Fred Butzen emails:
The story about the Pentgon's "terrorism market" clearly is an
extension of Iowa Electronic Markets, which has been run for years
by the University of Iowa's Tippett School of Business. Here's a
link to the Iowa Information Market's web site:
Link <http://www.biz.uiowa.edu/iem/>
In brief, the IEM lets persons place bets on the likelihood of given
events' happening; for example, people could bet on the likelihood
that Saddam Hussein will survive this year, or who will win the next
presidential election. The collective expertise of the participants
has proven to be extremely useful in predicting events.
The notion that the dim-bulbs in Congress and the media should
attack such a useful and proven idea as the Pentagon's is utterly
absurd.
This is absolutely right. Whether or not the Pentagon's idea is a good
one depends on details I don't know about. But the lame criticism makes
clear that the critics are -- as usual -- clueless on the subject.
ANOTHER UPDATE: Mitch Berg points out
<http://www.mitchberg.com/shotindark/2003_07_01_archive.html#105948759942593174>
that this approach has worked in the past.
posted at 08:44 AM by *Glenn Reynolds*
<http://www.instapundit.com/archives/010668.php>
Robin Hanson wrote:
FYI, our DARPA project (www.policyanalysismarket.com) has just been
denounced
by two senators:
http://wyden.senate.gov/media/2003/07282003_terrormarket.html
Robin Hanson [EMAIL PROTECTED] http://hanson.gmu.edu
Assistant Professor of Economics, George Mason University
MSN 1D3, Carow Hall, Fairfax VA 22030-4444
703-993-2326 FAX: 703-993-2323