The Wisdom of Crowds: not as easy as you think


I’ve been speaking against the idea of “Wisdom of the Crowd” in many tweets, but it might be good to explain why this is.

As usual, it starts with bad definitions of a good concept.

For starters, the concept is not “Wisdom of THE Crowd”, but the book title by James Surowiecki is “The Wisdom of Crowds“.

That is a big distinction, as the former implies that there is one large “crowd” (usually equated with the Internet) that is “wise”.

That idea has led to so many bad assumptions it’s just strange we can’t seem to get away from it.

Whole generations of apps have been created with exactly this idea as their basis. “The Crowd” will somehow magically infuse Wisdom into our world.

As we can see from nearly all applications, this is just not true. “A lie can run around the world before the truth gets its boots on” is particularly true on our application platforms.
“The Wisdom of Crowds”, where the definite article is crucially in a different place implies that SOME crowds are wise. It is no mistake that Surowiecki lists the characteristics of such a “wise crowd” in the first chapter of his book. Without them, it would be useless.

Surowiecki didn’t publish a one page pamflet with the sentence “The crowd is wise, so there.”

That’s what unwise crowds seem to have made out of it, in a supreme twist of irony.

Characteristics of “Wise Crowds”

Surowiecki lists four characteristics for a Wise Crowd:

1. Diversity of opinion
2. Independence of members from one another
3. Decentralization
4. Effective ways to aggregate opinions

Without these, it is an unwise crowd, and at worst a mob.

Let’s go over them:

Diversity of opinion
Each person needs to have his or her OWN opinion. It can be informed or uninformed. As a group however, it needs to have at least SOME accurate information available.
Independence of members from one another
People’s opinions need to be independent from the ones around them. They must not have a conflict of interest, so to say, of whatever form.
People should be able to specialise and have access to “local” knowledge.
I would take “local” here in the broader sense, not geographically. To a biologist, knowledge of biology is “local”, too.
Effective ways to aggregate opinions
The group needs to have a way to turn their private opinions into a common one.
All these four are necessary to form a “wise” crowd. If not, you get group that will not work.
Consider a crowd that only has ways to aggregate opinions. If the opinions of such a crowd are uninformed, you will get a mob that acts solely on bad information. In his book, stock market panic is described in this way.

Characteristics Explained

A group that has decentralisation only will have no way to forge the different sources of knowledge into a more coherent whole. It would just result in provincial bickering.

There is definitely wisdom in crowds, but sadly the term “Wisdom of the Crowd” has become a stale buzz word that proposes easy fixes.

“Just ask the crowd” is the worst way to conduct your business.

Any business owner knows that blindly asking customers “what they want” is ludicrous. Most customers cannot articulate what they want.

If Apple had polled “the crowd” it would never have produced the iPhone.

If Ford had polled “the crowd” it would have stopped producing cars and never implemented the assembly line.

Crowds can be very wise indeed, but not ALL crowds.

Our crypto sector suffers from this disease, too.

Twitter polls, voting on the blockchain, “decentralised communities”: useless unless the above is taken into account.

  • Crowds that are uninformed are mobs: they do not add, they break things down.
  • Crowds that don’t want to aggregate opinions but just push one agenda are lobby groups: horrible things.
  • Crowds that are dominated by their adoration for or dependence of a leader figure are armies.
  • Crowds that cannot form or are not allowed to form their own opinions are harassment groups.

I am all for the wisdom of crowds, but not if the concept is just another filler word.

It is certainly possible to get them. But as long as influencers keep using them the uninformed way, I will keep ridiculing them for it.
Bas Wisselink
Follow me
Latest posts by Bas Wisselink (see all)

Add comment

This site uses Akismet to reduce spam. Learn how your comment data is processed.

By Bas Wisselink

Recent Comments