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September 12, 2004
Do crowds make better decisions than individuals? Yes, says author James Surowiecki in The Wisdom of Crowds
THE WISDOM OF CROWDS BY JAMES SUROWIECKI
Why the many are smarter than the few and how collective wisdom shapes business, economies, societies, and nations
Traditionally, social sciences view the crowd as an unpredictable, dumb, and panicky monster. Now there is another point of view. New Yorker columnist James Surowiecki, who writes a popular business column and much about how markets work, has noticed a few things about crowd behavior that contradicts this view. He says in fact that crowds of all kinds can be remarkably wise. In The Wisdom of Crowds, Surowiecki explores the notion that large groups of people are smarter than an elite few, no matter how brilliant; crowds can be better at solving problems, fostering innovation, coming to wise decisions and even predicting the future.
Excerpt:
"If, years hence, people remember anything about the TV game show "Who Wants to Be a Millionaire?," they will probably remember the contestants' panicked phone calls to friends and relatives. Or they may have a faint memory of that short-lived moment when Regis Philbin became a fashion icon for his willingness to wear a dark blue tie with a dark blue shirt. What people probably won't remember is that every week "Who Wants to Be a Millionaire?" pitted group intelligence against individual intelligence, and that every week, group intelligence won."
"There are four key qualities that make a crowd smart. It needs to be diverse, so that people are bringing different pieces of information to the table. It needs to be decentralized, so that no one at the top is dictating the crowd's answer. It needs a way of summarizing people's opinions into one collective verdict. And the people in the crowd need to be independent, so that they pay attention mostly to their own information, and not worrying about what everyone around them thinks."
Review from the Wisdom of Crowds Home Page:
"The Wisdom of Crowds is a brilliant but accessible biography of an idea, one with important lessons for how we live our lives, select our leaders, conduct our business, and think about our world."
About the Author:
James Surowiecki is a staff writer at The New Yorker, where he writes the popular business column, "The Financial Page." His work has appeared in a wide range of publications, including the New York Times, the Wall Street Journal, Artforum, Wired, and Slate. He lives in Brooklyn, New York.
Review of The Wisdom of Crowds by The New York Times
Posted by DSN at September 12, 2004 07:09 PM