The Wisdom of Crowds

An ox was on display and for six-pence fair-goers could buy a stamped and numbered ticket, fill in their names and their guesses of the animal's weight after it had been slaughtered and dressed. The best guess received a prize.

Eight hundred people tried their luck. They were diverse. Many had no knowledge of livestock; others were butchers and farmers. In Galton's mind this was a perfect analogy for democracy. He wanted to prove the average voter was capable of very little. Yet to his surprise, when he averaged the guesses, the total came to 1197 pounds. After the ox had been slaughtered, it weighted 1198.

James Surowiecki takes Galton's counterintuitive notion and explores its ramification for business, government, science and the economy. It is a book about the world as it is. At the same time, it is a book about the world as it might be. Most of us believe that valuable nuggets of knowledge are concentrated in few minds. We believe the solution to our complex problems lies in finding the right person. When all we have to do, Surowiecki demonstrates over and over, is ask the gathered crowd.

The well-written book is divided into two parts. The first deals with theory; the second offers case studies. Believe it or not, I found it to be a page-turner. The author has that precious ability to render the complex in simple, understandable and interesting prose.

I have long been an admirer of H. L. Mencken who once wrote, "No one is this world, so far as I know, has ever lost money by underestimating the intelligence of the great masses of the plain people."

By the time I finished this book, I believed Mencken was wrong.


Turns Concept of "National Intelligence" Right Side Up   December 12, 2004
Robert D. Steele (Oakton, VA United States)
9 out of 14 found this review helpful

Edit of 20 Dec 07 to add links.

Edited 10 Jan 05 to point to Robert Buckman's book, Building a Knowledge-Driven Organization which is the implementation counterpart to this book. Those "stake-holders" whose egos are wrapped up in the hoarding of secrets will not like either of these books but the trends lines are clear: sharing beats hoarding, and collective intelligence of the group beats secret "single expert" intelligence just about every time.

Read this book along with Howard Rheingold's Smart Mobs: The Next Social Revolution, Tom Atlee's The Tao of Democracy: Using Co-Intelligence to Create a World That Works for All, Pierre Levy's Collective Intelligence: Mankind's Emerging World in Cyberspace--and if you wish, my own, The New Craft of Intelligence: Personal, Public, & Political--Citizen's Action Handbook for Fighting Terrorism, Genocide, Disease, Toxic Bombs, & Corruption This book has seriously altered my view of how to organize national decision-making. While I have been exposed to many great thinkers and authors, and formed my own views based on three decades in the defense-intelligence complex where America spends $70B a year on the 10% of the information it can steal, and next to nothing on polling, subject matter experts, and open sources of information, this book was an eye-opener for me.

I disagree with those reviews that dismiss this as "unscientific" or lacking in rigor. This book tells a very important story that could-that should-alter how we made decisions about very important matters with long-term consequences. While the author appears largely unwitting of the body of literature focused on this matter going back to at least Pierre Tielhard de Chardin and H.G. Wells, his book stands as a very valuable self-contained reference that cannot be ignored.

The author examines three broad situations: coordination, aggregation, and cooperation, and in all three concludes, with sufficient and compelling evidence as well as anecdote, that the best answers are from multiple disparate views that have been normalized. The author is also effective in pointing out that most "experts" rarely agree with one another, or get it right in the first place.

To take the simplest example, guessing the number of jelly beans in a jar, the author examines how "experts" or "closest individual guess" get within roughly 20 of the right number, while the crowd of disparate individuals--including biased and illiterate individuals--comes within 2. That is a huge benchmark.

This book is relevant to the application of emerging technologies, for example, application oriented networking systems and intelligent networks where P2P puts most of the knowledge at the edge of the network. What hit me with great force is that P2P and intelligent networks cannot be fully effective without an aggregation capability, a super-sized federated database system that scales infinitely--hence disqualifying all of the so-called relational databases.

I have over 20 notes on how to monetize the information in this book, which I consider to be the single most valuable book I have read in the past couple of years, after Thomas Stewart's "The Wealth of Knowledge." Here is one simple one as citizen blogs and other information including environmental information begins to come on line: why not create a citizen's digital dashboard for cell phones and hand-held devices, so that the barcode on a device creates a full price analysis--not just price in dollars and cents, but price in terms of the greenness of the maker, hidden costs, the human rights and labor relations record of the maker and the seller, etc. I see the day coming when government cannot fund stupid programs because the people put those corporations that build stupid things into bankruptcy, while the labor union pension funds start using their power to invest only in companies committed to sustainable growth. Far-fetched today--this book, and my own understanding of where information technology is headed in the next five years--made me smile.

This is not a "fad" book. It has a great deal of meat. For the hacker set, this is "SNOWCRASH" all grown up, married with children.

Other books with reviews:
The Wealth of Networks: How Social Production Transforms Markets and Freedom
Global Brain: The Evolution of Mass Mind from the Big Bang to the 21st Century
Group Genius: The Creative Power of Collaboration
One from Many: VISA and the Rise of Chaordic Organization


Essential reading   June 29, 2004
33 out of 37 found this review helpful

This is one of the most entertaining and intellectually engaging books I've come across in a long while. Surowiecki has a gift for making complex ideas accessible, and he has a wonderful eye for the telling anecdote. His thesis about the intelligence of groups made up of diverse, independent decision-makers seems initially counterintuitive, but by the end of the book it seems almost obvious, because of all the evidence Surowiecki piles up on its behalf.

The book does cover a lot of ground in not very much space, and the pace of the argument is at times too fast. But the throughline of the argument is almost always clear, and the stories Surowiecki tells are often memorable. The chapter on NASA's mismanagement of the Columbia mission and the tale of how a man named John Craven relied on collective wisdom to find a lost submarine are especially striking.

This is one of those books that I expect people will still be talking about and referring to years or even decades from now. It's also a book that I hope will have a concrete impact on the way that people make decisions, since the implications of Surowiecki's argument are radical in the best way.


Bubbling with Excitement over Economics   October 29, 2004
Nancy R. Fenn (San Diego)
2 out of 5 found this review helpful

This book could be criticized for lack of analytical rigor but on the other hand, it is a terrific introduction to some of the more fascinating aspects of statistics, economics and human behavior. As an astrologer and psychic, I have often commented to my clients, "You think what I do is a mystery? Economics is the biggest mystery of all!"

I found this book one of the few books this year that really changed the way I look at things and think about things.

For example, a recent immigrant from another country known to often pull my leg told me about cars being "automatically driven" down the highway here in San Diego a few years ago. I thought he was making it up. But it really happened. Surowiecki explains they were testing traffic patterns.

Surowiecki also cleared up a matter that had frustrated me -- the government's proposed futures market on terror attacks. I knew when I heard about it would work because I'm intuitive. But I never could have put it into words like Surowiecki did.

This is a great, fun, readable book that makes economics more clear to the average person and it changed the way I think about the world around me, so I give it a big FIVE STARS. Actually, I couldn't put it down!


Fascinating - Crowds Can Be Wiser Than Experts   April 14, 2005
G. Reid (Roseland, NJ)
5 out of 8 found this review helpful

In the TV show "Who Wants To Be A Millionaire" the player has a lifeline to ask the audience for the answer to one of his most difficult questions. The audience survey almost always answers the question correctly. This is just one well-known example of the wisdom of crowds.

Crowds are often wiser than individuals, even experts, if certain conditions are met. Conditions needed for crowds to be wise are as follows:

1. Diversity of perspectives
2. Independence of individuals within the group
3. Decentralization, aka local experience
4. Aggregation - the integration of different views & opinions

The author makes the case for the value of group decisions as long as the group is properly arranged to be effective. He shows how these decisions can be better quality than the decisions of individuals, even experts. These concepts form the backbone of our democratic governmental system. The lack of collective wisdom is often seen in the dangerous case of an autocratic-charismatic leader.