Wisdom of crowds and mass delusions

How well participatory democracy works depends on how large groups of people form their opinions. In this respect, there are two opposing ideas, the wisdom of crowds and mass delusions. The wisdom of crowds was discovered in 1906 by Francis Galton. He was visiting a livestock fair where an ox was on display. Villagers estimated the animal’s weight in a contest. Nearly 800 people participated. No one assessed the weight of 1,198 pounds correctly, but the average guess was 1,197 pounds. And that was almost perfectly right.

At least in specific cases, groups of individuals on aggregate assess a situation better than individuals on their own. The average included the extremes on both sides. Galton was impressed. He thought that this argued in favour of democracy. If all views are taken into account, for instance, in Parliament, it can result in good decisions.

At the fair, people assessed the ox’s weight independently. They did not arrive at their estimate in a group process. In group processes, most people desire the approval of their peers, and that can cloud their judgement. The reason why individuals in aggregate may make better estimates is that each individual has a unique perspective. And using multiple models usually leads to better assessments of a situation.

The wisdom of crowds depends on individuals making their assessments independently. It allows them to look at the issue in different ways. The more people influence each other, the more they become prone to groupthink so that the wisdom of crowds disappears.1 In extreme cases, groupthink leads to mass delusions like stock market bubbles.2

Diversity of opinions can make democratic decision-making better than other forms of decision-making. Ideally, in a democracy, all information is freely available to everyone, and everyone can arrive at and express opinions without fear. But mass delusions can make democracies fail. There may be several reasons why this is so, for instance, groupthink. Humans cooperate on a large scale with the help of shared imaginations. The degree to which these imaginations are adequate determines their success.

Featured image: The Wisdom of Crowds. Yeske Buie on Youtube.

Latest revision: 3 May 2022

1. The Wisdom of Crowds. James Surowiecki (2004). Doubleday, Anchor.
2. Extraordinary Popular Delusions and the Madness of Crowds. Charles Mackay (1841). Richard Bentley, London.