Thursday, July 8th, 2010 10:35:42
Irrational Events Affect Voters — Why College Football Matters
While most political pundits follow polls, they might want to start following college football.
I first learned about the efficient market hypothesis when studying for the Chartered Financial Analyst exam 20 years ago. The efficient market hypothesis states that markets are rational, and information is rapidly absorbed and reflected in the market.
This was an intellectually compelling hypothesis, based on the belief that humans rapidly process information and act rationally.
This same hypothesis is often applied to the political arena — voters receive, assimilate and process information regarding candidates and vote for one based on his or her record and policy platform.
But watch out, sports fans — what one thinks and what happens are not always the same.