Who's The Best Candidate?
Martin O'Malley: If drafted, I will run; but if nominated, I will probably be a disaster. 
Without a doubt, one of the best parts of political elections are active prediction markets. For observers of predictionmarket activity, a lot can be learned about how politics works.
I'm curious whether prediction markets can answer an important political question in the U.S.: Is someone a good candidate for president? And they actually can.
Prediction markets give us probabilities that candidates will win the Republican and Democratic nominations for president and the probability that they will win the general election. If we assume that candidates compete for only one nomination and cannot stage a thirdparty run if they do not win  that is, no John Andersons allowed  then we can easily estimate the probability of them winning the general election, conditional on winning the party nomination.*
When political pundits discuss whether someone is a good candidate for president, I think this conditional probability is exactly what they mean.
Taking these two probabilities from three different prediction markets  PredictWise, Betfair, and PredictIt  I am able to estimate this "competitiveness" score for nine top contenders for the Republican and Democratic nominations: Jeb Bush, Marco Rubio, Scott Walker, Rand Paul, and Chris Christie for the Republicans, and Hillary Clinton, Elizabeth Warren, Joe Biden, and Martin O'Malley for the Democrats. (Some technical notes can be found below.)
Here's what I find: The best Republican candidate is Jeb Bush, who has a 67percent chance of winning the general election if he wins the nomination. The worst Republican candidate is Scott Walker, who has a 44percent chance.
Among Democrats, Joe Biden and Hillary Clinton are nearly tied for the top candidate, with 58percent and 57percent chances of generalelection victory if either secures the nomination. With a 24percent chance, Martin O'Malley is the worst Democratic candidate.
You can see the full table of results here:
On the other hand, the prediction markets think that the rest of the field is remarkably weak. Another takeaway to the parties, then, might be: Nominate one of these candidates, or you will get crushed. This also helps explain why many of the top candidates can have better than 5050 odds of winning in the general election if they win their party's nomination.
I would also remind readers about the "noJohnAndersons" assumption. If a candidate could stage a viable thirdparty race  one might imagine this for Warren or Paul  then my estimates might be a bit low.


* I will step through the math. By the law of total probability:
P(wins election) = P(wins election  wins nomination)*P(wins nomination)
+ P(wins election  ! wins nomination)*P(! wins nomination),
and then by assumption that P(wins election  ! wins nomination) = 0 :
P(wins election) = P(wins election  wins nomination)*P(wins nomination)
** Two technical notes:
(1) Since prediction markets for both the nomination and the general election do not exist for all candidates, I wasn't able to go further than the top names. Another issue, for some long shots, was that the probabilities are coarsely estimated  that is, if you have about 2percent chance of winning the nomination, whether that 2percent is really 2.4 percent or 1.6 percent matters, and I do not have that level of precision. So I excluded candidates that prediction markets see as long shots.
(2) Prediction markets are Dutchbooked to ensure profits for the market maker. To correct for this, I rebased the relevant probabilities so that they summed to one.