Collective hype

I have just finished “The Wisdom of Crowds” by James Surowiecki. I must admit that my choice of mental nourishment this time was not determined by a continuous interest in pop psychology but due to the fact that it was rather high up on the mininova audiobook list in terms of the number of seeders.

In other words, I had no idea how good this book was but I made my decision to listen to it by riding on the decisions of others. Which is interesting because this is one of the more important concepts discussed by Surowiecki.

Surowiecki argues that a group of human beings could make good collective decisions when the following four conditions are satisfied:

1. Diversity of opinion: Each person should have their own private information even if it's just an eccentric interpretation of the known facts.
2. Independence: People's opinions aren't determined by the opinions of those around them.
3. Decentralization: People are able to specialize and draw on local knowledge i.e. facts that they possess due to the particular position they are in.
4. Aggregation: Some mechanism exists for turning private judgments into a collective decision.

For example, if I post a picture of myself on this blog (which I so will not do) and ask everybody to independently email me and tell me how much I weigh, I can add up all those estimates and the average will correspond very closely to my actual weight. Of course the answers will be distorted depending on whether I have clothes on or not.

The mean guesstimate will be quite accurate, based on the criteria above because:

1. All of you are very different, despite the Tourism Minister’s claim that out of the 10,000 bloggers out there, 8,000 are actually pathological female liars.
2. All of you would not consult each other about my weight, although it might be fun to do so.
3. Each one of you will make your conclusion based on your own experience about someone who resembles me e.g. good looking people normally would work out a lot thus what looks like fat is actually muscle which is more dense.
4. We have a method for collecting this data i.e. emails.

Going back to my decision in downloading “The Wisdom of Crowds”, it looks like I was influenced by other people’s decision to do the same. Which is not conclusive about whether the book is good or not.

What was more interesting were stories about how bad decisions are made. For example, the September 11 attacks were not foreseen because the various US intelligence agencies did not aggregate their data. Another was the dotcom bubble bursting due to stock market decisions being based on the participants’ trying to ancticipate how other people are playing the market.

I would recommend this book as essential reading. It would answer many questions you are afraid to ask. Most importantly:

"What's with these Mawi lovers?"



Note: Mawi is accused of being high on drugs in this video. If he was not, it only confirms what a wanker he is.