Developing, testing, and disseminating information on influenza using prediction markets
Suppose a stock market could be repurposed to predict the next influenza hotspot. Researchers from the University of Iowa Business School and infectious disease experts came together to explore this concept and the Iowa Electronic Health Markets were born. In the past, prediction markets have successfully forecasted trends and outcomes ranging from currency prices and stock options to political elections and movie box office receipts. They work by aggregating information from a knowledgeable group of "traders" — people with an informed opinion about what will happen — who "purchase" shares in an event they think is likely to occur. If that event transpires, the trader receives an award (often, but not always, a sum of money). By using a prediction market as a platform to gain insight by tapping into the wisdom of an informed crowd, researchers may be able predict when and where infectious diseases will strike.
During the 2006-07 U.S. flu season, the markets accurately forecasted outbreaks a full two to three weeks in advance of official announcements. And, in 2009, they accurately predicted that H1N1 influenza would spread widely and quickly during the first few weeks of the epidemic and that the mortality rate would be less than 1 percent. Building off the success of the flu markets, the Iowa team is working with the U.S. Centers for Disease Control and Prevention to attempt to get an earlier, more precise read on the spread of syphilis in order to hasten progress toward its eradication. The team will closely track progress, seeing whether prediction markets can serve as a tool to enhance surveillance, prevention and response efforts for a wide range of public health threats.
Amount Awarded $1,150,425.00
Awarded on: 7/29/2005
Time frame: 8/1/2005 - 7/31/2011
Grant Number: 53352
108 John Pappajohn Business Building
21 East Market Street
Iowa City, 52242-1000