Computational Model Library

Opinion dynamics model for prediction markets (1.0.0)

We introduce a model of prediction markets that uses opinion dynamics as its underlying mechanism for price formation. We base the opinion dynamics on the Deffuant model of bounded rationality. We have used this model to show that price formation in prediction markets can be robustly explained by opinion dynamics, and that the model can also explain phase transitions depending on just two parameters.

Release Notes

New code release

Associated Publications

10.20944/preprints202307.1444.v1

Opinion dynamics model for prediction markets 1.0.0

Submitted by Valerio Restocchi Published Jul 31, 2023 Last modified Jul 31, 2023
Entropy in Agent-Based Models prediction market agent-based computational economics opinion dynamics complexity of markets

We introduce a model of prediction markets that uses opinion dynamics as its underlying mechanism for price formation. We base the opinion dynamics on the Deffuant model of bounded rationality. We have used this model to show that price formation in prediction markets can be robustly explained by opinion dynamics, and that the model can also explain phase transitions depending on just two parameters.

Release Notes

New code release

Cite this Model

Valerio Restocchi (2023, July 31). “Opinion dynamics model for prediction markets” (Version 1.0.0). CoMSES Computational Model Library. Retrieved from: https://www.comses.net/codebases/ad846d74-f1a0-408d-87e6-c13dc9dfc8c7/releases/1.0.0/

Replication of a previously described model

No

Associated Publication(s)

10.20944/preprints202307.1444.v1

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Contributors
Valerio Restocchi
DOI
No assigned DOI
Model Version
1.0.0
License
CC-BY-SA-4.0
Programming Language
Python
Software Framework
Python
Operating System
Operating System Independent
Publish Date
Monday, July 31, 2023
Last Updated
Monday, July 31, 2023
Downloads 21
Peer Review
Unreviewed
Version Submitter First published Last modified Status
1.0.0 Valerio Restocchi Mon Jul 31 10:23:58 2023 Mon Jul 31 10:23:58 2023 Published

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