The wisdom of crowds

How can a group of stupid individuals that only think locally (within their own specialization and local knowledge) result in a solution that can serve the overall common good for the collective as a whole? "the wisdom of crowds" by James Surowiecki convinced me with numerous examples that that is possible. But why are there many examples and arguments that a group of people is more stupid than individual? James suggested that three conditions are important to ensure collective wisdom: diversity, independence, and discentralization. I think that is very insightful.

Diversity is key to collective wisdom. First, because it provide alternatives for options. Like many industries in history, at the start, there are always many kinds of design, many kinds of technologies, and many kinds of styles produced many companies trying to create a market. However, in the end, usually one a very small of them remain. None was able to pick the winners beforehand, but "what makes a system successful is its ability to recognize losers and kill them quickly." (p.29). Second, the diversity of options are not enough, but the group has also to be diverse because only so we can have different perspectives, and diversity has its value on its own right. "Homogeneous groups are great at doing what they do well, but they become progressively less able to investigate alternatives" (P.31)

"Ultimately, diversity contributes not just by adding different perspectives to the group but also by making it easier for individuals to what they really think...diversity helps preserve that indpendence, it's hard to have a collectively wise group without it" (p.39)

Another key condition is independence. It is interesting that he discuss independence that we as autonomous beings with we as social beings. Although he recognizes the social nature of existence, he argues that "the more influence a group's member exert on each other, and the more personal contact they have with each other, the less likely it is that the group's decisions will be wise". that is a very strong point, and kind of work against what we believe in social computing, which is based on the assumption that, we are fundamentally social creatures, and if we make social information visible, if we encourage social interactions, we can have positive results either the enhanced connections or informed decisions. He mentioned the information cascade effect, where people who do not have complete information will follow and learn from others, however, bad things happen when at certain point, people become stop paying attention to their own knowledge and just blindly imitate others, this is when information cascade stops being informative.

The final condition is decentralization. Decentralization foster and is fed by specialization. it also means only people know the local and specific situation and come up with the best solutions. The key is a balance between making individual knowledge globally and collectively useful will still allowing it to remain resolutely specific and local. "A decentralized system can only produced genuinely intelligent results if there's means of aggregating the information of everyone in the sytsem"