Are crowds smart or dumb?

Rob Henderson has an interesting book review in Quillette.

Are crowds smart or dumb? You may have heard the terms “wisdom of the crowds” and the “madness of crowds.” The former idea is that the collective opinion of a group of people is often more accurate than any individual person, and that gathering input from many individuals averages out the errors of each person and produces a more accurate answer. In contrast, the “madness of crowds” captures the idea that, relative to a single individual, large numbers of people are more likely to indulge their passions and get carried away by impulsive or destructive behaviors. So, which concept more accurately reflects reality?

Noise: A Flaw in Human Nature by Daniel Kahneman, Olivier Sibony, and Cass R. Sunstein provides the answer. The authors share research indicating that “independence is a prerequisite for the wisdom of crowds.” That is, if you want to use crowdsourcing to produce accurate information, you have to ensure that people make their judgments in private. If people provide their answers in a public setting where they can see everyone else’s answers, then the crowd can transform wisdom into madness.

Fairly long and it contains nothing startling, but it is still well worth reading the whole review because there are quite a few insights which modern life tends to obscure. This for example -

In 2011, the educated class generally favored meritocratic and objective measures for judgment and decision-making. They found the message that we should challenge the role of bias in our everyday judgments appealing, and believed that we should rid ourselves of habits that lead us to judge other people or situations unfairly. Today, however, much of intellectual culture has changed. Now that luxury beliefs are ascendent, relying on objective measures is no longer fashionable.