The miracle of the markets: Identifying key campaign events in the Scottish independence referendum using betting odds

This paper analyses campaign dynamics in the 2014 Scottish independence referendum by integrating time-stamped polling releases with highly granular evolving price data created by online political gambling markets. Our analysis models the relationship between poll releases and prices available on a Yes result, allowing us to measure the extent to which the release of each new poll represented an informational ‘shock’. We then seek to control for polling shocks in order to isolate and analyse the effects of key campaign events; combining a multivariate time series analysis with confirmatory testing based on a micro-analysis of the movement in gambling prices in the minutes and hours following these events. We conclude that the second leaders' debate between Alex Salmond and Alistair Darling was the most influential event of the campaign, initiating a surge in the Yes side's estimated probability of victory.