The Wisdom of Crowds: Why the Many Are Smarter Than the Few and How Collective Wisdom Shapes Business, Economies, Societies and Nations
17th March 2006 by Sean
| Author:James Surowiecki |   |
Eric Schmidt from Google recommended this book in the “mistakenly” published powerpoint presentation slide notes from Google’s Analyst Day a couple of weeks ago. I had heard of it, but didn’t know much about it, so I did a little research and it seems like James Surowiecki, a writer for the New Yorker, has some great evidence (or maybe just ideas) about trusting the masses.
Surowiecki goes over types of crowd wisdom, types of crowd wisdom, and failures of crowd intelligence and how when certain factors combine, the wisdom of the crowd is much more accurate than the wisdom of individuals, even experts. One of the stories he uses to illustrate this is a study done in the 19th century by a British Anthropologist named Francis Galton. In the study he took an ox to a county fair and had people guess its weight. He also had cattle ranchers and farmer (experts) guess the weight. The general public as a whole did much better at guessing the weight than the so-called experts.
In the review snippets there is a link to Wikipedia’s entry for the book, which goes over these and other topics in a bit more detail. Also, from what I can tell, Wisdom of Crowds reads a lot like a Malcolm Gladwell book.
What Wikipedia says.
The Wisdom of Crowds: Why the Many Are Smarter Than the Few and How Collective Wisdom Shapes Business, Economies, Societies and Nations, first published in 2004, is a book written by James Surowiecki about the aggregation of information in groups, resulting in decisions that, he argues, are often better than could have been made by any single member of the group. The book presents numerous case studies and anecdotes to illustrate its argument, and touches on several fields, primarily economics and psychology.
The opening anecdote relates Francis Galton’s surprise that the crowd at a county fair accurately guessed the weight of an ox when their individual guesses were averaged (the average was closer to the ox’s true weight than the estimates of most crowd members, and also closer than any of the separate estimates made by cattle experts).
The book relates to diverse collections of independently-deciding individuals, rather than crowd psychology as traditionally understood. There are parallels with statistical sampling theory—a diverse collection of independently-deciding individuals is likely to be more representative of the universe of possible outcomes, thereby producing a better prediction.
What a commenter on Kottke.org says.
To be fair and to set the record straight for all those who haven’t read the book, Surowiecki is certainly not suggesting that groups of people make wise decisions under all possible circumstances. Big chunks of the book are spent discussing when group decision making breaks down as well as situations when you’d think the group might be smarter but isn’t. WoC isn’t a condemnation of individual effort or genius, it’s just a way of thinking about some common situations where collective thinking might apply.