The Wisdom of Crowds

Wisdom20crowds

I’ve just finished reading James Surowiecki’s The Wisdom of Crowds. It is a book that I’ve heard bandied about as a seminal text in the Web 2.0 world. It is therefore rather surprised me that the internet isn’t mentioned in the book at all. The book has been picked up by Web 2.0 enthusiasts who see echoes of their own enthusiasms in its conclusions – but is isn’t actually about Web 2.0.

  

Wisdom of Crowds is subtitled “Why the many are smarter than the few” and as such sets about proving in a variety of ways that individuals, even very brilliant ones, are unlikely to have all of the answers. The book is based on experimental economics and social psychology and uses a variety of different bits of research and anecdote to demonstrate that an aggregated answer from a number of people is usually more likely to be right than the best guess of an expert. This is all good stuff and seems all the more valuable now Web 2.0 technologies are helping people to collaborate and aggregate their opinions.

 

Surowiecki is keen to explain that group opinions are not necessarily better than individual opinions all the time. If the group is working closely together there is a danger that they will all come to the same decision or that they will simply norm towards the view point of a particularly persuasive member. If the group is too similar they will lack the diversity that leads to a strong aggregated opinion. Surowiecki sets out the following three principles

  • Independence
  • Diversity
  • Decentralisation

As being essential for the wisdom of crowds to function.

 

So far so left wing platitude. The many are greater than the few, the people have the answer etc etc. What is interesting however is the way that Surowiecki’s message is articulated largely as an appreciation of markets. Generally he feels that markets represent the strongest tool for aggregating opinions, better than collective consensus, better than democracy and so on. This is the case because in other aggregating mechanisms (such as democracy) the answer usually emerges as the result of some discussion. Through the discussion people tend to come to some kind of consensus and the value of having diverse decision makers involved is reduced. Although Surowiecki doesn’t say this it seems that first past the post democratic systems are more likely to lead to this kind of compromise that more proportional systems.

 

As I read this I suppose I was a little uncomfortable with the enthusiasm for markets. I’ve tended to view free markets as a pretty problematic element of governance and one that tends to reward the rich and powerful at the expense of the poor and numerous. I’ve probably moderated some of my opinions on this somewhat and have come to believe that a mix of state power, markets and common ownership exist in all economies, even those that claim to be lassez faire or command economies. The question therefore remains what the blend between state, market, individual and collective needs to be. However reading Surowiecki has made me realise that the market is a mechanism that can be employed in a variety of contexts. When we speak of markets we are not only speaking of capital markets, we can also be speaking of markets in ideas or markets in prediction. Twitter is a good example of a market in ideas – things live or die on Twitter because people retweet or engage in them. There is no vote, no majority decision etc, it is therefore not democratic in any meaningful sense, but is rather a vibrant market in ideas.

 

So what are the implications of this for careers work? On one hand it represents a very significant challenge to the idea of expertise. Surowiecki would argue that the advice that is given by an expert is much less likely to be right than that given by a wide range of individuals. So the answer to questions like “what should I do?” or “what is it like to be an accountant” is likely to be better if the people giving the answers include a range of people (parents, friends, accountants, people in other professions etc etc). From this viewpoint the careers worker’s role might be to design appropriate systems for people to aggregate the opinions of others in a productive way. Advice would be about how to network, gather diverse opinions and synthesise them, rather than providing a simple answer to a question.

I think that some careers workers have been doing this anyway. However, reading the Wisdom of Crowds might help people challenge some of their assumptions and come up with new ways of thinking about their roles.

 

As ever all thoughts and ideas on this are appreciated…

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One thought on “The Wisdom of Crowds

  1. I thought the first few chapters were very good, certainly gave me new insight, but the second half of the book was less good and rather repetitive.

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