Faulty Signals in Information Cascades
Information cascades occur when individuals are presented with the choice to either adopt or reject a decision based on the observed actions of previous participants. As we learned about information cascades, I was often reminded of a social network site I frequent: IMDb. Indeed, the underlying principles of information cascades can be applied to an individual’s usage of the Internet Movie Database.
For many people including myself, the instinctive course of action when deciding whether to watch a movie is to look up its IMDb rating. When presented with little information regarding the value and quality of a newly released movie, the easiest method of decision is to defer to the opinions of those who have already seen it, which are aggregated and quantified simply through a single average star rating. Viewing this rating, the collection of what may be dozens, thousands, or millions of signals, may guide an individual to follow the decision established by the predominant choice.
However, the cascade that may result from a movie’s IMDb rating is a faulty one, since the site cannot verify with certainty that a user has watched a movie they rated. A particularly disastrous case can be found with Al Gore’s climate change documentary An Incovenient Sequel: Truth to Power, released only a few months ago. The documentary currently sits at a 5.8 user rating, an average of 3,791 ratings, but thousands of those ratings were submitted before the movie’s release and 60% of the ratings are either 1 or 10. Because the subject of climate change is such a politically divisive topic, it is no surprise that thousands of IMDb users had preemptively submitted their ratings based on their individual stances on the film’s subject matter without having even seen it. An Inconvenient Sequel’s mediocre score of 5.8 may therefore influence potential viewers to opt out of watching the film, an effect from the opinions of users who have no justification in rating it.
Source: http://www.imdb.com/title/tt6322922/ratings?ref_=tt_ov_rt