…Dwelt a miner forty-niner…
In 1848 gold was discovered at John Sutter’s California sawmill. Two years later the state’s population had increased by more than 500%
It was said that the diggin’ was so easy that gold nuggets were being picked up off the ground. This at first attracted people from places of proximity- Oregon, Hawaii, Mexico, Peru. Soon, though, east coasters were making the arduous trip across the country to strike it rich. They left their families, leaving their wives to tend to farms and businesses. Unfortunately very few left wealthier then the arrived. Most left worse off then before, but they believed gold or bust! This is an information cascade at its very best.
Information about the ease of the riches in California ran rampant through the news on the east coast. It is true, that the very first to arrive became wealthy but the rest were left with empty mines and empty rivers. The lucky few sent information to the east propagating the belief that riches were guaranteed. Similar to the marble experiment talked about in class this information was believed to be correct based on very first initial discoveries. Subsequent information refuted that gold was littered on the ground but the information had already cascaded. It was so powerful that men were willing to mortgage their homes, spend their life savings and leave their families in the hopes of becoming obscenely wealthy. This example of information cascades is similar to others. A small bit of information- coupled with an initial small following- influences and motivates a large population towards a certain action.
http://www.history.com/topics/gold-rush-of-1849