EXAMINING TRADER BEHAVIOR IN IDEA MARKETS: AN IMPLEMENTATION OF GE'S IMAGINATION MARKETS

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Published: Dec 17, 2012
DOI: https://doi.org/10.5750/jpm.v3i1.450
Keywords:
Idea market prediction market idea generation brainstorming group support system.

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Brian Spears
GE Hitachi Nuclear Energy
Christina LaComb
John Interrante
Janet Barnett
Deniz Senturk-Dogonaksoy

Abstract

We present the outcome of an idea market run for one of GE Energy's sub-businesses in July and August of 2006.  GE Energy used this market to elicit and rank-order technology and product ideas from across the sub-business. In this experiment, we examine the behavior of traders that have submitted the ideas on the market and their influence on the market's outcome. An idea’s submitter is clearly motivated to have his idea valued highly by the market, both by the funding given to the top idea as well as smaller prizes given to the top three ideas. In general, founders tended to buy their suggested ideas at prices above the volume-weighted-average-price (VWAP) in significant volumes. We discuss the implications and mitigation strategies. A survey of market participants yielded mixed results regarding the market's effectiveness at ranking ideas but very positive results regarding the quality of ideas proposed.

Article Details

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Vol. 3 No. 1 (2009): Corporate Applications for Prediction Markets
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Articles

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