Expert Elicitation and Crowd-sourcing for Better Decision-making and Management
The tendency of majority opinions to converge on reality has been long recognized, and more recently discussions have centered on harnessing such phenomena to provide social value. Advanced Conservation Strategies leverages innovative tools and techniques from a variety of sectors and applies them to environmental contexts to aggregrate and synthezse information for better decision-making and management.
Expert Elicitation Surveys
The natural history of organisms is central to biology and subsequently biodiversity conservation. Yet, for the majority of species we know little about their natural history and even less about how specific anthropogenic hazards interact with their biology. Conservation targets and management decisions are often at the regional level—focused on a specific breeding populations. Yet, assessments of extinction risk for species are usually conducted at the global level. For example, six of the seven species of sea turtles are listed as Endangered or Critically Endangered by the International Union for Conservation of Nature. The on-the-ground utility of those assessments, however, is unclear because significant differences in population trends exist among ocean basins. For example, Pacific Ocean leatherback turtles have experienced major declines over the last decade, while Atlantic Ocean populations are stable or increasing. Without a globally comprehensive assessment of hazards to sea turtle populations at the regional level, it will be challenging to prioritize and strategically implement practical conservation actions. Assessing regional hazards is particularly challenging for data-poor species like sea turtles, given that they are notoriously difficult to study, migratory, long-lived, and commonly face multiple anthropogenic threats. Yet, a copious amount of information for sea turtle conservation planning resides not in the literature, but rather in the knowledge and experience of sea turtle scientists, naturalists, and conservation practitioners.
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Using expert eliciation surveys and models, ACS recently delivered a regional assessment of threats to endangered sea turtles. Expert elicitation, a technique used to synthesize the opinions of experts, while assessing the uncertainty around those views, has been in use for several decades in the social science and risk assessment sectors. We used an expert opinion survey to globally assess the relative impacts to sea turtle populations at the regional level, and the uncertainty around those impacts for a range of known hazards. We also explored potential biases associated with different types of "experts."
Priority setting for the conservation of threatened and endangered species cannot wait for exhaustive empirical research. ACS delivers innovative solutions today. Given the broad reach of the Internet in the 21st century, web-based expert opinion surveys are a strategic way to aggregate information that can help set priorities for conservation action plans and related research. Expert opinion surveys focused on threatened and endangered species and their hazards can help guide and expedite effective recovery plans.
Prediction Markets
The tendency for a large number of opinions on a topic to converge on reality has long been recognized . More recently, discussions have centered on discovering and harnessing such phenomena with markets and other crowd-sourcing approaches. Stock price movements around a particular event quickly and accurately process information—market prices aggregate dispersed knowledge about economic value. For example, the 1986 government investigation regarding the Space Shuttle Challenger tragedy took five months to identify a faulty O-ring as the cause. The market, however, pinpointed the guilty party within hours of the disaster: the supplier of the Shuttle’s booster rocket seals, Morton Thiokel, one-day return was -11%, more than six standard deviations greater than the firm’s average return three months prior to the crash. While other firms connected to the space shuttle also experienced an immediate decline in share price the day of the explosion, none were greater than two standard deviations than the three-month average return. Orange juice futures provide another insightful example. Their prices are a good predictor of Florida weather. However, orange juice futures contracts are responsive to additional factors as well (e.g., fuel costs and labor supply), making it challenging to predict weather solely on contract prices. Prediction markets are designed explicitly for such purposes: they provide isolated, informative measures of investor’s beliefs ex ante.
Prediction markets—forums for trading contracts that yield payments based on the outcome of uncertain events—are just starting to be explored for their potential to generate social value. Since social and environmental information is often widely dispersed, a mechanism to collect and aggregate that information offers significant utility. Markets usually provide such as mechanism, since almost anyone can participate and the potential for profit (and loss) creates strong incentives to search for better information. Prediction markets exploit the aggregation function of markets to assemble investors’ beliefs about the likelihood of future events into usable forecasts. For example, entertain a contract that pays $1 if a certain candidate, John Doe, wins the presidential election in 2012. If the market price of a “John Doe contract" is trading at $0.75, then the market “believes” John Doe has a 75% chance of winning the election. The Iowa Electronic Markets have outperformed polls in predicting the outcomes of presidential elections over the past twenty years. In fact, one week prior to past presidential elections, these prediction markets had an average error of 1.5 percentage points (compared to 2.1 percentage points for the final Gallup poll). Even more impressive is that 150 days prior to election day, the error was only 5 percentage points. Prediction markets are now being used widely, internally and externally, in the private sector to accurately forecast a wide array of events from product sales (e.g., drugs and Hollywood movies) to sporting events to “economic derivatives”, which allow traders to take positions on the outcomes of macroeconomic data releases.
ACS is using prediction markets to aggregrate environmental information in new and useful ways. Contact us to find out more.