Thursday, October 2, 2008

Prediction Markets at Best Buy

Best Buy is running one of the largest internal corporate prediction markets. The experiment raises interesting questions about incentives for managers whose projects are "listed" on the market, as well as questions about how to design simple interfaces that thousands of non-experts can use.

"When executives at electronics retailer Best Buy Co. want to know if a new product or idea is likely to succeed, they can seek the opinion of rank-and-file employees by turning to the company's "prediction market."

The market, called TagTrade, allows Best Buy's workers to trade imaginary stocks based on answers to managers' questions. The market's judgment has often proved to be more accurate than the company's official forecasts."

(subscription required to see full article)

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