Is There Wisdom in Crowds?

When people can learn what others think–over the internet or through news programs, for instance–the usual wisdom of crowds may veer towards mass ignorance. We especially tend to see this during election seasons.

Crowd wisdom is a phenomenon by which individual biases cancel each other out, distilling hundreds or thousands of individual guesses into uncannily accurate average answers. But when a new study asked people about OTHER participants’ guesses, their group insight no longer worked. Mathematician Jan Lorenz and sociologist Heiko Rahut write that "Although groups are initially ‘wise,’ knowledge about estimates of others narrows the diversity of opinions to such an extent that it undermines collective wisdom. Even mild social influence can undermine the wisdom of crowd effect."

The study of crowd wisdom–which might better be called its ACCURACY–reached its height in 2004, with economist James Surowiecki’s book "The Wisdom of Crowds." Surowiecki said that for crowd wisdom to emerge, members of the crowd needed to have a variety of opinions, and to arrive at those opinions independently.

In Wired.com, Brandon Keim quotes Lorenz and Rahut as saying, "Opinion polls and the mass media largely promote information feedback and therefore trigger convergence of how we judge the facts. The wisdom of crowds is valuable, but used improperly it creates overconfidence in possibly false beliefs. The truth becomes less central if social influence is allowed." They think this problem could be strongest in the stock market and in politics.

One person who had his own, unique opinions was the Master of the Key, who burst into Whitley Strieber’s Toronto hotel room in 1998 and began to tell him things he didn’t know which later turned out to be TRUE. The new, UNCENSORED edition of The Key, with a foreword that talks about how many of his statements later turned out to be true, is in bookstores NOW!