I gave a presentation earlier today at the 2nd Greek National Conference of Mechanical & Electrical Engineers. The speech introduced the concept of prediction markets, as long as market applications in logistics, to a multidisciplinary audience. The presentation triggered a lot of interest and more than supportive reactions.
The introductory paper (in greek), entitled as Prediction Markets as Decision Support Tool for Supply Chain Management, is available here, while its abstract is as follows:
The intrinsic uncertainty throughout logistics processes highlights the need for accurate rognoses. While the typical approaches to the forecasting problem continue to present a less han perfect method, lately a new one seems to be offering a promising alternative. Prediction markets serve to aggregate participants’ information in a nearly optimal and very dynamic way, while they are also capable of effectively processing all of the available knowledge and data thereby operating as a meta-mechanism for prognosis. The paper introduces by description, review and example the concept of prediction markets, while also providing an analytic framework of applying this for decision support in supply chain management.