Matt makes a point that hadn’t really occurred to me, perhaps because I am not the sort of blogger who might actually be able to influence a race.
Well, I don’t do that because it seems to me that it would call my professional work into question. I don’t want it to be the case that if I say stuff about the candidates I get accused of trying to juice my contracts.
Interesting. I doubt that most news consumers would credit any journalist with the ability to alter races, and to the extent that they can, it would probably take a concerted effort (a Fox News effort, you might say) such that the bias would be apparent and discountable. Of course, it’s also true that who says what isn’t as important as what is said. A big-time scandal allegation could move prices in a way that repeated Yglesian endorsements would not, and as such, Matt, or other bettors, would have an incentive to go find a big-time scandal (or, you know, lie about one).
It’s interesting to consider this in light of the other financial incentives that journalists have. Prediction market trading might seem like a clear conflict of interest, but I don’t know that we can really pull it apart from the broader idea that a journalist’s professional success depends, in no small part, on what he or she writes and on who happens to like that kind of writing. There’s no inoculating a writer from those incentives, so in the end it may be better to allow trading with full disclosure.
At any rate, I understand that the perception matters. Matt has worked hard to establish a well-deserved reputation for calling-it-like-it-is, and it would be stupid for him to threaten that for a few political market bucks. As such, I’ll merely encourage him to trade on the play market.
(Also: to all Matt’s readers, welcome. Those of you who are unhappy with my particular line of argument in the previous post, please feel free to see what else I’ve written on these markets).