# Cortical prediction markets

arXiv: https://arxiv.org/abs/1401.1465 · HTML: https://mlsanity.com/paper/1401.1465/

## Key facts

- Cited by 2 papers in the map (data through 14 Oct 2026).
- First posted on arXiv 7 Jan 2014.

## Built on by (most cited first, 2 of 2)

- [Modularity in Reinforcement Learning via Algorithmic Independence in Credit Assignment](https://mlsanity.com/paper/2106.14993/) (2021)
- [Seeking Next Layer Neurons' Attention for Error-Backpropagation-Like Training in a Multi-Agent Network Framework](https://mlsanity.com/paper/2310.09952/) (2023)

## Abstract (arXiv)

We investigate cortical learning from the perspective of mechanism design. First, we show that discretizing standard models of neurons and synaptic plasticity leads to rational agents maximizing simple scoring rules. Second, our main result is that the scoring rules are proper, implying that neurons faithfully encode expected utilities in their synaptic weights and encode high-scoring outcomes in their spikes. Third, with this foundation in hand, we propose a biologically plausible mechanism whereby neurons backpropagate incentives which allows them to optimize their usefulness to the rest of cortex. Finally, experiments show that networks that backpropagate incentives can learn simple tasks.