Potential Problems in Following the Wisdom of the Crowd
Over the past couple weeks, we’ve learned about information cascades in class and discussed the “Wisdom of the Crowd” phenomenon. Wisdom of the Crowd refers to people imitating the decisions of others even when their private information indicates otherwise. The article “Pitfalls of ‘Wisdom of the Crowd’” by Phillip Ball explains the trend and also highlights potential problematic aspects of following the decisions of others.
The article discusses that the judgment of the crowd actually is surprisingly accurate overall but only when people’s decisions are independent from each other. This is evident in the observations of Charles Darwin’s cousin Francis Galton who noticed the shocking accuracy of the average of all entries in a ‘guess the weight of the ox’ competition. Galton stated that the average of the guesses beat the guesses of “alleged cattle experts” (Ball).
On the other hand, when these guesses are no longer independent, this average is not nearly as exact, but the range of the guesses become more precise. This was demonstrated through a study by the Swiss Federal Institute in which different groups of participants were asked to estimate certain quantities relating to geography or crime. For example, one of the estimations was the length of the Swiss-Italian border. Results of the study indicated that groups who received more information about the other participants gave a much narrower range of guesses, but this range wasn’t necessarily closer to the actual value and, in some cases, was actually further from the true value. Overall, this article provides an interesting expansion on the topic of the Wisdom of the Crowd and indicates the importance of thinking about the opinions of others before agreeing with them.
Article: https://www.bbc.com/future/article/20140708-when-crowd-wisdom-goes-wrong