Self-financed wagering mechanisms for forecasting

  • Authors:
  • Nicolas S. Lambert;John Langford;Jennifer Wortman;Yiling Chen;Daniel Reeves;Yoav Shoham;David M. Penno k

  • Affiliations:
  • Stanford University, Stanford, CA, USA;Yahoo! Research, New York, NY, USA;University of Pennsylvania, Philadelphia, PA, USA;Yahoo! Research, New York, NY, USA;Yahoo! Research, New York, NY, USA;Stanford University, Stanford, CA, USA;Yahoo! Research, New York, NY, USA

  • Venue:
  • Proceedings of the 9th ACM conference on Electronic commerce
  • Year:
  • 2008

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Abstract

We examine a class of wagering mechanisms designed to elicit truthful predictions from a group of people without requiring any outside subsidy. We propose a number of desirable properties for wagering mechanisms, identifying one mechanism - weighted-score wagering - that satisfies all of the properties. Moreover, we show that a single-parameter generalization of weighted-score wagering is the only mechanism that satisfies these properties. We explore some variants of the core mechanism based on practical considerations.