Can search engines predict the future?

Posted on April 8, 2011

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When we analyse what people search for on the internet, we’re trying to pick up on trends and topics people are interested in.

Man with crystal ball

A recent post I did about the rise of depression in the UK showed a rise in people searching for depression treatments in the UK over the last four years and just yesterday, a report into the rise of depression by the BBC came to the same conclusion.

On reviewing the two reports, I was struck by accuracy of  my search insight when placed alongside the BBC’s data.  Searches for depression treatment had indeed risen by around 40% mirroring the reports data from the department of health almost exactly.

So that got me thinking.  If using a freely available tool such as Google insights for search can predict with accuracy the state of the nation, months before official figures (as Google’s flu prediction tool can).  Can it be used to predict the future?

Taking stock

Studies have already tentatively shown that twitter could be used to predict stock market ups and downs and Google are obviously looking into something similar here  but have probably concluded that it would be illegal to do such a thing and no doubt would keep quiet about it even if they did find a trend.

For anyone wanting to persue the idea of using search behaviour to predict stock market trends however there is hope This study found a correlation between rises in search volume for a particular company and the volume of shares traded in that company the following week however it couldn’t predict the price (rise or fall).  I suspect that further sentiment analysis of those search terms however could well provide indicators as to whether a share price would rise or fall (so if suddenly a large number of people are generally saying IBM sucks or searching for refunds online, share prices would be expected to dip).

It’s not just the stock market that can be predicted though.  The health of the nation, what we eat, crowd numbers, housing demand, political motivations… The list is only limited by our imaginations and how much access we have to Google’s data. 

I strongly believe that teaching people how to mine this data will help to empower citizens and help them to make their own decisions about what’s going on with the country rather than relying on spin and the media.  The data revolution starts here!*  Power to the people!

Oh, and by the way, if anyone is inspired to carry out further research into predicting the stock market by this blog post and is succesful,  just remember who inspired you and that my cut is 10%!

*Note to future researchers trying to find out where the data revolution started – it wasn’t here, sorry.

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