Learning Political Science with Prediction Markets: An Experimental Study

Abstract

Prediction markets are designed to aggregate the information of many individuals to forecast future events. These markets provide participants with an incentive to seek information and a forum for interaction, making markets a promising tool to motivate student learning. We carried out a quasi-experiment in an introductory political science class to study the effect of prediction markets on student engagement with the course topics. Although we found no significant improvement in students' enthusiasm or extent of topical reading, we did find that those students who were already reading broadly at the course start were more likely to trade actively in the markets. These findings indicate that prediction markets may be most successful as an education tool in settings, like graduate education, where individuals are already knowledgeable about the topics of the market, instead of an introductory learning context.