Thinking about the German election outcome, it struck me that this would be an ideal test for betting markets. I’ve always thought that, if there’s a bias in such markets it would be towards the right, so the toughest test for them would be predicting a left-wing upset win like this one (I’m calling a win on the basis that left parties got a majority of the vote, not making a prediction about what goverment might emerge). A quick Google reveals that there is such a market, called Wahlstreet but my German isn’t good enough to deal with their site, which has lots of graphs bouncing around without an obvious control. Hopefully someone will be able to help me.
Anyway, if there’s a contract allowing a bet on the share of votes for the three left parties (SPD, Greens, Left party) and if, two weeks in advance, that market was predicting a vote share of more than 50 per cent (as actually happened), I’ll concede that the case for the superiority of betting markets over polls has been established, at least as a reasonable presumption. [I didn’t follow the polls closely but I had the impression that most of them were predicting a CDU/CSU win until the last days of the campaign].
Reader Andrew Reynolds has also invited, a couple of times, my thoughts on the Japanese election. My reticence in this case is due to the fact that I have a strong antipathy towards Koizumi (the Japanese PM) that I can’t really explain. There are plenty of objective grounds I could cite, like his visits to shrines for war criminals, but my feeling is based more on a gut reaction that the guy is something of a fraud, and this colours my view of his policies. For example, I think corporatisation of the Post Office (this was the current proposal actually being debated in the recent election with privatisation a future option) is a good policy, given its history as an LDP porkbarrel, but this is scarcely an innovative or radical idea, and I see no evidence that Koizumi can do anything more than drag up warmed-over neoliberal policies which (in Australian terms) date back to the 1980s.
In addition, there’s something clearly wrong with a situation where the same party always wins even when its performance is consistently lousy for 15 years. If Koizumi were really the innovator he’s presented as, he would have split from the LDP and joined forces with the opposition.
As I say, you should take all this with a grain of salt, given the biases I’ve confessed above, but those are my thoughts for what they are worth.