Prediction Markets:A literature review 2014

In recent years, Prediction Markets gained growing interest as a forecasting tool among researchers as well as practitioners, which resulted in an increasing number of publications. In order to track the latest development of research, comprising the extent and focus of research, this article provides a comprehensive review and classification of the literature related to the topic of Prediction Markets. Overall, 304 relevant articles, published in the timeframe from 2007 through 2013, were identified and assigned to a herein presented classification scheme, differentiating between descriptive works, articles of theoretical nature, application-oriented studies and articles dealing with the topic of law and policy. The analysis of the research results reveals that more than half of the literature pool deals with the application and actual function tests of Prediction Markets. The results are further compared to two previous works published by Zhao, Wagner and Chen (2008) and Tziralis and Tatsiopoulos (2007a). The article concludes with an extended bibliography section and may therefore serve as a guidance and basis for further research. (250 WORDS