Some of the earliest and most popular prediction markets (per se) have been linked to elections, but predicting tax rates is much more to-the-point in terms of financial risk-sharing. The
existence of such markets would also frame the operation of the
government in a way that would encourage fiscal responsibility, and
give dispersed interests some recourse against inefficient spending.
Here is the full post. It is suggested that everyone wants to hedge against higher marginal rates, thereby making the market one-sided. But doesn’t somebody benefit from taxes going up? Thanks to Chris F. Masse for the pointer.