“Wisdom” I learned from the “Wisdom of Crowds”
I wrote down what I thought were the most interesting points below. Some are quotes, others are my interpretation.
This guy John Craven was looking for a lost submarine. His accomplishment was taking everyone elses guesses and combining them. It ended up being within 220 yards of his final prediction [https://en.wikipedia.org/wiki/John_P._Craven#cite_note-faceplate2006-3].
American society is highly based on reciprocity meaning that most people will participate as long as they believe that everyone else is participating too. America is built upon the concept of “contingent consenters”. They’re willing to pay their fair share of taxes but only as long as they think that others are doing so, too, and only as long as they believe that people who don’t pay their taxes have a good chance of being caught and punished. “When people start to feel that the policeman are sleeping, and when they think others are breaking the law and getting away with it, they start to feel like they’re being cheated”.
One study was a bunch of grad students asking for people to give up their seat on the subway. About 50% of people agreed to. The hardest part of the study was getting the grad students to muster up the courage to ask. Is this more reflective of the grad students or students in general? IDK.
Specialization tends to make people productive and efficient while at the same time increasing the scope and diversity of the opinions and information of the total system when put in a group with others. Interesting thought. Not necessarily sure I agree.
Ideology does a better job predicting votes preference than self-interest. Conservatives w/o health insurance would still oppose national health insurance. This idea has been passed throughout the ages but has recently become more popular in lieu of the trump administration.
Putting notions into peoples heads can mess them up. Jack Treynor did an experiment where he asked people to guess the # of jelly beans in a jar. Average guess was within 3%. He repeated experiment but told people there was air @ the top of the jar and that jar was made of plastic, not glass, meaning it could hold more beans that expected. Average guess was within 15%.
Apparently bowling company mania was a thing in the stock market. From mid 1950’s to mid 1960’s bowling companies skyrocketed on wall street and then came crashing down (I’ll do a write up about this in the future b/c I think its interesting).
Schelling points - what people tend to choose by default in the absence of communication. E.g. Ask a person in NYC where is the most obvious place to meet another person in NYC. Most people will say Grand Central Station. I think the example in the book is a little bit weak but there are plenty of other examples. Schelling point comes from Thomas Schelling, economist, in his book “The strategy of conflict”. If someone has read it before let me know if its any good.
Groups are better at deciding between possible solutions to a problem then they are at coming up with them. Invention is usually better left to individuals but selecting among inventions should be a collective process.
If you want a collective group to come to the perfect answer you have to make sure that all of their estimates are independent of each other. Independence is important b/c it keeps the mistakes that people make from being correlated. One of the quickest ways to introduce bias is to make people dependent on each other.
Want to prevent conformity? Just have one other person in a group announce their thoughts that are opposite the current view of the group and the rate of conformity plummets.
Scott Page, political scientist @ University of Michigan, did computer simulation experiments. Found that diverse groups of smart plus non smart people did better than groups of smart people.
A big thing I’m leaving out is prediction markets. Contrary to what crypto people believe prediction markets have been around for a long time before the introduction of augur.The book does a good job touching upon them.