http://www.intrade.com/jsp/intrade/misc/blog/#kendall_1Analysts of the 2008 election have repeatedly cited the Bradley effect as a reason to discount polling data in elections pitting white candidates against black candidates, arguing that some voters tell pollsters they would vote for a black candidate when they intend to vote for the white candidate. Yet analyzing the data, it appears that Obama shares are performing as well as (or perhaps outperforming) his RealClearPolitics (RCP) polling data, indicating that
Intrade investors believe that the RCP polls understate Sen. Obama's margin of victory.The Bradley effect refers to the California gubernatorial election of 1982, in which the black mayor of Los Angeles, Tom Bradley, lost an election he had been expected to win. In a number of other elections featuring black candidates versus white candidates, the black candidate appeared to fare worse on Election Day than expected (see here for anecdotes from elections from the 1980s through 2006). While there is still active debate about whether the Bradley effect may have disappeared as American social attitudes changed in recent years, the evidence from Intrade markets is clear:
Intrade market participants completely discount the Bradley effect.(snip)
In other words,
Intrade traders clearly believe that the Bradley effect will not be a factor in the 2008 Presidential election. Prices of Obama contracts remained above 50 at a time when he was behind in the polls, indicating that Intrade traders believed that the polls actually underestimated Obama's likely election performance. When Sen. McCain's lead in the polls grew, the price of Obama shares briefly dropped below 50 but they quickly recovered with the evidence of improvement in the polling data.
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