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In this fascinating book, New Yorker business columnist James Surowiecki explores a deceptively simple idea: Large groups of people are smarter than an elite few, no matter how brilliant -- better at solving problems, fostering innovation, coming to wise decisions, even predicting the future.With boundless erudition and in delightfully clear prose, Surowiecki ranges acrossIn this fascinating book, New Yorker business columnist James Surowiecki explores a deceptively simple idea: Large groups of people are smarter than an elite few, no matter how brilliant -- better at solving problems, fostering innovation, coming to wise decisions, even predicting the future.With boundless erudition and in delightfully clear prose, Surowiecki ranges across fields as diverse as popular culture, psychology, ant biology, behavioral economics, artificial intelligence, military history, and politics to show how this simple idea offers important lessons for how we live our lives, select our leaders, run our companies, and think about our world....

Title : The Wisdom of Crowds: Why the Many Are Smarter Than the Few
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ISBN : 9780349116051
Format Type : Paperback
Number of Pages : 295 Pages
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The Wisdom of Crowds: Why the Many Are Smarter Than the Few Reviews

  • Whitaker
    2019-03-17 04:00

    I’ve read James Surowiecki in the New Yorker. I’ve generally enjoyed his articles and found them fairly informative and engaging. I think that perhaps he should stick to that: writing articles. This book was, well, disappointing. And I suspect that it’s because I expect more from a book. I expect an analysis that is more balanced and rigorous. While I am willing to accept a little grandstanding in an article, I find it intolerable in a book. What’s ironic about all of this is that he’s written a book celebrating diversity of thought, but there’s absolutely none of that in this book. I thought that there were some interesting anecdotes, ideas and bits of information here, but that ultimately all the pieces did not gel into a whole. Not only was the sum of the information not more than its parts, I actually thought it was less. The book also had problems for me in a number of key areas that totally detracted from any regard I might have had for it. Pet Peeve #1 It’s damned annoying when something is misrepresented. It makes me wonder what else is being misrepresented that I can’t pick up because I don’t know what I don’t know. He totally misrepresented Keynes in a number of ways, quoting him out of context. He quotes Keynes’s statement, “Worldly wisdom teaches that it is better for reputation to fail conventionally than to succeed unconventionally,” as if Keynes supported that statement. The full quote by Keynes is this:“...an investor who proposes to ignore near-term market fluctuations ... will in practice come in for most criticism, wherever investment funds are managed by committees or boards or banks. For it is in the essence of his behaviour that he should be eccentric, unconventional and rash in the eyes of average opinion. If he is successful, that will only confirm the general belief in his rashness; and if in the short run he is unsuccessful, which is very likely, he will not receive much mercy. Worldly wisdom teaches that it is better for reputation to fail conventionally than to succeed unconventionally.”Keynes is actually praising the long-term investor but stating how hard it is to not simply follow the crowd. This is the opposite of what Surowiecki uses him for. He later quotes Keynes’s statement about the stock market:“Professional investment may be likened to those for newspaper competitions in which competitors have to pick out the six prettiest faces from a hundred photographs, the prize being awarded to the competitor whose choice most nearly corresponds to the average preferences of the competitors as a whole; so each competitor has to pick, not those faces which he himself finds prettiest, but those which he thinks likeliest to catch the fancy of other competitors, all of whom are looking at the problem from the same point of view.”He then goes on to state that that behaviour is what Keynes “recommends”. This is not only not what Keynes recommends, but what he is against. The statement quoted is Keynes’ description of how the stock market works: people speculating rather than making up their own mind based on fundamentals. He then explains that this is why there are bubbles and crashes: because people are simply following the herd. Again, the total opposite of what Surowiecki uses him for.This is pretty egregious as far as I’m concerned. Pet Peeve #2He misrepresents facts. He describes an experiment conducted in the late 1980s by Paul Andreassen:Andreassen divided students into two groups. Each group selected a portfolio of stocks, and knew enough about each stock to come up with what seemed like a fair price for it. Then Andreassen one group to see only the changes in the prices of their stocks. They could buy and sell if they wanted, but all they knew was whether the price of a stock had gone up or down. The second group was allowed to see the changes in price, but was also given a constant stream of financial news that supposedly explained what was happening. Surprisingly, the less-well-informed group did far better than the group that was given all the news... the students who had access to the news overreacted... The students who could look only at the stock’s price had no choice but to concentrate on the fundamentals that they had used to pick their stocks to begin with.The thing is, financial information is exactly what the fundamentals are supposed to be. The entire idea behind financial information is that you know what is happening to the company, and hence what its future prospects are, rather than being in dark and just speculating. He then goes on to say, “The problem of putting too much weight on a single piece of information is compounded when everyone in the market is getting that information... Groups are only smart when there is a balance between the information that everyone in the group shares and the information that each of the members of the group holds privately.” You know what we call it when people trade shares on “information that each of the members of the group holds privately”? It’s called insider trading. The solution to the problem of the market overreacting is not to disclose less information. It’s to enforce a trading halt when an important piece of information is to be announced so that the market has time to digest the information. The annoying thing is that I’m sure he knows this. It just doesn’t make for very interesting reading. Pet Peeve #3He draws sweeping conclusions from cherry picked examples. His book looks at the following events: 1. The rise of the petrol-driven car at a time when other alternatives like a steam-engine car and an electric car were also commercially available alternatives. 2. The fad for wooden tracks instead of asphalt roads, which eventually turned out to be a huge mistake. The first incident is cited as an example of the genius of the market. The second one is cited as an instance when the market got it wrong. Why and when does a crowd get it wrong? He gives two explanations: ● A crowd gets things wrong when there is an information cascade. People don’t make up their own minds; they depend on other people for information. ● A crowd is best at making decisions when it is presented with choices. How exactly it is that the first example differs in a material way from the other one is never really supported with hard researched facts. There were choices in both the examples of the car and the wooden tracks. And in both cases, the standard had a champion that went around hard-selling his alternative. Anyone remember the war between Betamax and PAL? Or between Microsoft and Apple? In each of those cases, the less efficient standard won. But you’re not going to see those stories in this book. He gives another story how the market is a genius at determining facts. Here he relies on the Challenger disaster and its consequence on Morton Thiokol. This was the company that was eventually found responsible for the accident. Of the four companies that were involved, its stock went down the lowest and the fastest even before official conclusions as to the cause were reached. This is one of his proofs that the market “knows” the facts even before the facts are in. He also talks about Enron, but as an example of how a top-down managed company is bad. Oddly, the fact that the market didn’t “know” the facts about Enron doesn’t come up. Here’s a final one. He talks about how people on the street are able to move smoothly along as an example of the crowd being intelligent. Several chapters down he talks about how traffic can snarl up and we can get stuck in jams. But really in terms of fluid dynamics, there’s no difference between one and the other. Worse, he omits examples of situations when there are too many people on a crowded street and a panic just starts for no reason: a stampede arises and people die. Pet Peeve #4 The fact is that he doesn’t really say anything terribly insightful: ● Decisions are better made when we take into account all the facts and listen to divergent views that present various perspectives. ● Following other people is useful sometimes; other times it’s disastrous. Well, du-huhhh, dude! More annoying to me is when he says banal things that are wrong:The banal but key point I’m trying to make is that the more important the decision, the less likely a cascade is to take hold. To translate that, he’s saying that when we have to make important decisions, we tend to listen to other people less and rely on our own judgment more. Really? Tell that to the people who sunk their life savings into Savings & Loans, into internet stocks, into mortgages they couldn’t afford. The opposite is in fact often true: that when we are faced with a major decision that can have long lasting consequences, we often follow what seems to have been successful for everyone else. In Conclusion...I think he had a number of interesting facts that he tried to make too much of. I think if you look hard enough, there are situations when a crowd’s decision turns out right and when it turns out wrong. But you could probably find individual decisions with the same result. And I’m quite sure that under some circumstances, a crowd will come to a better collective decision. What I don’t think is that you can usefully draw any general magic bullet rules about this. Each situation is sui generis and specific to itself. As always, the devil is in the details. But that doesn’t make for a very interesting book, or one that will sell, does it.

  • TK Keanini
    2019-03-19 03:00

    I enjoyed this book. I wrote a review and then read everyone else's review and decided to return to write something more to the point. Some people did not even finish the book so I'd like highlight a few important concepts Surowiecki was trying to communicate.The four essential conditions that make up a smart or wise crowd are: - Diversity of OpinionEach person must have some private information that he/she brings to the group. Their own interpretation or their own understanding of the problem space or a related problem space. - IndependencePeople hold to their own reasoning to some degree- DecentralizationIndividuals are able to specialize and draw on their local knowledge. Someone is going to be closest to a certain aspect of the problem space and this is what is meant by local knowledge.- AggregationThe means to synthesize the thoughts of the team in to a collective decision.All four need to be met in order for the crowd to be wise. If you experience in life has been that crowds are dumb, changes are one of these four conditions were missing.In order to reorient yourself to what Surowiecki is saying, it may require an entirely new framing of your world and some are just not willing to do that.The book is fantastic and required reading for people in a leadership position.

  • Trevor
    2019-02-23 01:56

    This book begins with a bang and ends with a bang – so I guess it is not too surprising that there is a bit of a whimper in the middle. In some ways this book covers similar ground to other books I’ve read recently, particularly Fooled by Randomness The Hidden Role of Chance in Life and in the Markets. In fact, it could be that I’ve been reading far too many of this type of book recently and so they are all starting to merge into one.The kinds of people who do tests on other people did a test in which they asked a group of people to guess how many jelly beans there were in a jar. There were 850 jelly beans in the jar and the average guess was something like 875 beans. This is a mere 3% out from the actual figure. The interesting thing in this story is that only one individual was able to guess more accurately than the group was able to guess on average. That is, individuals guessed randomly and badly, and yet, collectively their guess averaged out all of the bad guesses to such an extent that the group guess was better than virtually any individual guess (and given that before counting you couldn't know which was the one individual to rely on more than the group going with the group actually seems like the only logical option. Now, isn’t that a remarkably outcome?You see, it stands against a lot of our most cherished beliefs and intuitions. Those are that there exist in the world experts – and to quote Laura Anderson, “Only an expert can deal with the problem, because only an expert can see the problem”. But in fact experts often do remarkably badly at what they do, even in their special area of expertise. Sometimes that area of expertise needs to be so narrowly defined that it becomes very hard to know what questions an expert is actually expert in. Worse still is the fact that we are human and tend to have too high an estimation of our own expertise. Our cherished beliefs are perhaps best summed up by that quote from Nietzsche, “Madness of single persons is something rare, but the madness of groups, parties, crowds seems to be the rule”. And there seems to be lots of evidence of madness in groups, which is, of course, the opposite thesis to that put forward in this book. There is a discussion in this book, for example, on market failures (particularly bubbles) and this can make crowds seem completely insane. The most interesting example in the book was a discussion on a woman in Seattle who was standing on a bridge considering whether she should commit suicide during the peak hour traffic rush hour. Naturally, this tended to hold up the peak hour traffic as she was being 'talked down' by the Police. But while the Police were trying to talk her down pedestrians and drivers alike (both put-out by this woman’s ‘antics’) started to call on her to kill herself (quoted in the book as ‘go ahead and jump, bitch’). The crowd finally won and the woman did jump. Now, it would seem hard to argue that there was a lot of wisdom in that particular crowd, and Nietzsche would seem to have a rather large chalk mark added to his side of the board. The point of this book is not to argue that crowds are always wise, nor that they are always right. The point is to say that crowds of people often make the best decision – better than the decisions of even the smartest individuals in a group. Not only that, the group is generally a safer bet than ‘a leader’ because what we are interested in when we pick leaders is not always their ability to lead us to the best of all possible futures, but to (perhaps) look rather dashing in a pin-striped suit. That is, the argument put forward in this book is that groups tend to do better at picking what is best for the group than individuals can, and also to point out when groups are most likely to fail. The jelly bean example above is an interesting case in point. Here we got a group of people to pick the number of jelly beans in a jar and they did better on average than virtually all individuals in that group at picking the number of jelly beans. But the example gets even more interesting. After the group made its choice it was given another go. This time they were given some ‘additional information’. This information was that people should pay particular attention to the fact that there is an air gap at the top of the jar and that the jar is made out of thin plastic, and not thick glass. Both of these pieces of information were ‘true’, but they also both pointed in the direction that would increase the magnitude of the already too high guesses the group had made. Not surprisingly, the new guesses now made by the group tended to be even higher than previously and the difference between guess and number of jelly beans increased to 7% above the actual number of beans.The lessons from this are, I think, far reaching and profound. Yes, groups can be too easily fooled, particularly by experts directing their attention, and that the words ‘mob’ and ‘riot’ are not nearly as much fun if you're not in a crowd – all the same, I still disagree with Nietzsche. Most of us, as individuals, are a bit nutty in one way or another; we are also terribly fixed in our views. In fact, there are numerous examples presented in this book to make the case that groups tend to be much more rational than individuals.There is also an interesting discussion on centrally planned economies and free markets. One of the clear problems with the Soviet Union was, it would seem, that as there was no market to direct what would be produced, people got bonuses for producing lots of what no one wanted. It is not immediately apparent why Socialism should be diametrically opposed to free markets. The notion that a Socialist economy, an economy whose stated aim is to provide what is in the best interests of society, should be interested in what the members of society wants hardly seems contradictory. Perhaps the dichotomy isn't something we should be swinging between - socialist control, market freedom. With all the talk of market failures at the moment I’m becoming increasingly concerned that we will be able to separate babies and bath water.I’m also very interested in worker participation in their jobs. For a society that spends so much time talking about the benefits of democracy, we clearly don’t think (or rarely think) that those benefits should extend to the workplace. And yet, as is also shown in this book, when democracy is extended into the workplace it brings unequivocal benefits to everyone. As someone who finds much of the exercise of power to be more about ego than the cloak of efficiency it seeks to dress itself in, extending democracy seems infinitely appealing to me.Tangential to this idea is something else noted in passing in this book, that often a company losing one of its long standing and valued employees (only to be replaced by someone with less expertise) actually has a positive effect on the business. This is because groups tend to be far too exclusive and to only see as valid what they already know. Someone new coming into the group often gets to be the truth sayer. The major recommendation in this book, in its quest to really gain wisdom from groups, is to ensure the group is as diverse as possible and that everyone feels they can have a say. There is quite a bit of talk about the downside of too much information, particularly too much speculation on the causes of what are probably random fluctuations – but in general, more diversity is better than more homogeneity, despite how much worse it might feel at the time.The other core idea is that we should seek to do everything in our power to increase 'trust', as when trust is lost people are much more likely to act as mobs, rather than crowds. Again, we do like to be lead, but being lead often is at the cost of diversity and that is virtually never a good thing.I think this book gave a compelling argument in favour of democracy – however, there was a long bit in the middle about American Football (with lots of talk about things that went a bit like this – ‘they were in their fifth at the seven yard line and had to work out whether to play it safe and go for a field goal or take a 50% chance on…) and, frankly, I didn’t follow a word of it. If I’ve learnt anything, it is that while sporting metaphors are difficult in English, they are impossible in American.I was particularly interesting in his defence of short selling in stock markets. Nothing if not brave. All the same, I think he makes a rather compelling case.Despite this, there were many worthwhile ideas in this book and I would highly recommend it.

  • Mike Banino
    2019-02-28 22:22

    Two heads are better than one. And a hundred heads are even better. And a thousand are almost perfect. Watch the asymptote as it approaches infinity... You are getting veeeerrrry sleeeeepy...This is a very interesting concept, fleshed out into a very boring book. It seems like a graduate thesis that got stretched to book length for publication in hopes of drafting the popular slipstream of writers such as Malcolm Gladwell.The premise is fascinating, and the first chapter delivers. After that it reminds me of papers I wrote in high school, where I'd state a proposition and then strip-mine all available research materials in a singleminded quest for [only] supoorting information. It feels very one-sided.Overall, as I'm sure you can tell, I found it a bit of a disappointment because it could have been a very enjoyable article or even a book if it wasn't so heavy-handed in pursuing the thesis's applicability to every aspect of human endeavor.

  • Sara Alaee
    2019-03-17 03:18

    “The Wisdom of Crowds is not an argument against experts, but against our excessive faith in the single individual decision maker. I think there are two big problems with relying on a single individual—no matter how well-informed. The first is that true experts—that is, the real titans—are surprisingly hard to identify…The second, and more important, problem is that even brilliant experts have biases and blind spots, and so they make mistakes. And what's troubling is that, in general, they don't know when they're making those mistakes…” --James SurowieckiThis book takes a good look at the theory of Collective Intelligence which is defined as the shared wisdom (or intelligence) emerging from the collaboration and cooperation of individuals. Through numerous anecdotes and discussing several experiments, the author highlights the situations where the crowd came up with answers at least as good as (sometimes better than) experts’ opinions : betting markets, guessing games, Linux, etc. He also addresses the cases where the crowd failed to be wise: the Challenger explosion, The Columbia space shuttle disaster, the stock-market bubble, the bowling bubble, etc. The reasons for why and how each of these stories (and many more) turned out as either successful or unfortunate lie in the properties which define a wise group. The author argues that, under right conditions, a group can – and will – be smarter than its smartest members.As indicated in the book, the conditions/requirements for a wise group include: Diversity (of opinions), Independence, Decentralization and Aggregation. Diversity guarantees that different perspectives from different individuals are brought into the decision process. Independence ensures that people’s opinions aren’t determined by the opinions of those around them. Decentralization certifies that people are able to specialize and draw on local knowledge. Finally, Aggregation provides some mechanism to turn private information into a collective judgment. Using these four properties, a wise group is able to solve three types of problems, namely Cognition, Coordination and Cooperation problems. Cognition deals with problems that need deliberation and information processing. These problems have definitive solutions. Coordination includes problems that require members to organize their behaviors in order to work together effectively. And, Cooperation requires self-interested and often distrustful people to work together without a central system controlling their behaviors. Unlike cognition, collective solutions to the last two problems, i.e. coordination and cooperation, are fuzzier and less definitive.With clear prose and interesting little stories covered in the book ranging across diverse fields of economy, culture, history, politics, etc., this is a very practical and engaging book. I’d recommend it to all.

  • BenCampopiano
    2019-03-18 21:54

    "As he walked through the exhibition that day, Galton came across a weight-judging competition. A fat ox hade been selected and placed on display, and members of a agathering crowd were lining up to place wagers on the weight of the ox. (Or rather, they were placing wagers on what the weight of the ox would be after it had been slaughtered and dresssed.) For sixpence, you could buy a stamped and numbered ticket, where you filled in your name, your address, and your estimate. The best guesses would receive prizes. Eight hundred people tried their luck. They were diverse people. Many of them were butchers and farmers, who were presumably expert at judging the weight of livestock, but there were also quite a few people who had, as it were, no insdier knowledge of cattle. "Many non-experts competed," Galton wrote later in teh scientific journal Nature, "like those clerks and others who have no expert knowledge of horses, but who bet on races, guided by newspapers, friends, and their own fancies." The analogy to a democracy, in which people of radically different abilities and interests each get one vote, had suggested itself to Galton immediately. "the average competitor was probably as well fitted for making a just estimate of the dressed weight of the ox, as an average voter is of judging the merits of most political issues on which he votes," he wrote.Galton was interested in figureing out what the "average voter" was capable of because he wanted to prove that the average voter was capable of very little. So he turned the competition into an inpromptu experiment. When the contest was over and the rpizes had been awarded, Galton borrowed the tickets from the organizers and ran a series of statisitcal tests on them. Galton arranged the guesses (Which totaled 787 in all, after he had to discard thirteen because they were illegible) in order to from highest to lowest and graphed them to see if htey would from a bell curve. Then, among other things, he added all the contestents' estimates and calculated the mean of the group's guesses. That number represented you could say, the collective wisdom of the Plymouth crowd. If the crowd were a single person, that was how much it would guessed the ox weighed.Galton undoubtedly thought that the average guess of the group would be way off the mark. After all, mix a few very smart people with some mediocre people and a lot of dumb people, and it seems likely you'd end up with a dumb answer. But Galton was wrong. The crowd had guessed that the ox, after it had been slaughtered and dressed, would weigh 1,197 pounds. After it had been slaughtered and dressed the ox weighed 1,198 pounds. In other words, the crowd's judgment was essentially perfect. Perhaps breeding did not mean so much after all. Galton wrote later: "The result seems more creditable to the trustworthiness of a democratic judgment than might have been expected." That was, to say the least, an understatement." (p. XII - XIII)"Under the right circumstancesm, groups are remarkably intelligent, and are often smarter than teh smartest people in them. Groups do not need to be dominated by exceptionally intelligent people in order to be smart. Even if most of the people within a group are not especially well-informed or rational, it can still reach a collectively wise decision." (p. XIII)"First they put a single person on a street courner and had him look up at an empty sky for sixty seconds. A tiny fraction of the passions pes stopped to see what the guy was looking at, but most just walked past. Next time around, the psychologists put five skyward-looking men on teh corner. This time, four times as many people stopped to gaze at the empty sky. When the psycholgists put fifteen men on the corner, 45 percent of all passersby stopped, and increasin the cohort of observers yet again made more than 80 percent of peds tilt their heads and look up." (p. 43)"Wordly wisdom teaches that it is better for reputation to fail conventionally than to succeed unconventionally." --JOHN MAYNARD KEYNES (p. 51)"In a cascade, people's decisions are not made independently, but are profoundly influenced - in some cases, even determined - by those around them." (p. 57)"One key to a successful group decision is getting people to pay much less attention to what everyone else is saying." (p. 65)"Decentralization's great strength is that it encourages independence and specialization on the one hand while still allowing people to coordinate their activites and solve difficult problems on the other. Decentralization' great weakness is that there's no guarentee that valuable information which is uncoverd in one part of the system will find its way through the rest of the system." (p. 71)"Ultimatum Game, which is perhaps the most well known experiment in behavioral economics." (p. 112)"Talkativeness may seem like a curious thing to worry about, but in fact talkativness has a major impact on the kinds of decision small grouops reach. If you talk a lot in a group, people will tend to think of you as influential almost by default. Talkative people are not necessarily well like by other members of the group, but they are listened to. And talkativenss feeds on itself. Studies of group dynamics almost always show that the more someone talks, the more he is talked to by others in the group. So people at the center of the goup tend to become more important over teh course of teh discussion." (p. 187)"Instead of assuming that all problems need to filtered up the hierarchy and every solution filtered back down again, companies should sart with assumption that, just as in the marketplace , peple with local knoweldge are often best positioned to come up with a workable and efficient solution. The virtues of specialization adn d local knoweldge often outweight managerial expertise in decision making." (p. 212)"...found that the in the best companies, "Employees and managers were empowered to make many more independent decisions, and urged to seek out ways to improve company operations, including their own." (p. 212)"THe more responsiblity people have for tehir own environments, the more engaged they will be." (p. 212)"The idea of the wisdom of crowds is not that a group will always give you teh right answer but that on average it will consistently come up with a better asnwer than any individual could provide." (p. 235)"... conditions that make a group intelligent: independence, diversity, private judgement." (p. 244)"... In collective decision making, it doesnt matter when an individual makes a mistake. As long as the group is diverse and independent enough, the errors people make effictevely cancel themselves out, leaving you with the knoweldge that the group has." (p. 278)

  • Kara
    2019-03-06 02:13

    One of our VPs asked if I had read this and would recommend it for our company's global book club. I said no but jokingly added that I could read it tonight and let her know tomorrow. She didn't realize I was joking, so...now I'm reading it tonight.Sometimes these things happen.-----This book does get dry at times, but it has a lot of information in it. What I particularly liked about it is that it referenced all kinds of studies. This is not a book of opinions or a representation of a speaker’s presentation in book form; this is a book aggregating research and theories done on the subject of crowds and decisions over the years. (There are also pages of notes in the back if anyone would like to do further research.)I believe the intent here is to be a cross between a Malcolm Gladwell and Freakonomics, but it’s not quite as accessible as they are. (Some of the negative reviews said this read more like someone’s thesis paper--I wouldn't go that far, but I see where they're coming from.)The theme of the book is that crowds, when they’re the right type of crowds, perform better than individuals, even very smart individuals. He goes through a bunch of examples when crowds were wise (the average guess of the weight of the pig was very close to its actual, sports betting, Linux) and when they were wrong (the Challenger explosion, the Columbia disaster, the Bay of Pigs). He then talks about what characteristics makes crowds wise. That boils down to: diversity of opinion, independence, decentralization, and aggregation.Diversity of opinion: “Collective decisions are only wise when they incorporate lots of different information.” If everyone thinks the same way and has the same background, a crowd will be no smarter than an individual. The individuals in the crowd need to bring their own experiences and knowledge to be effective.Independence: When one person makes a prediction after hearing other people’s first, this can affect the outcome and cause a “cascade” effect. “The problem,” he says, “starts when people’s decision are not made all at once but rather in sequence…People fall in line because they believe they’re learning something important from the example of others…after a certain point it becomes rational for people to stop paying attention to their own knowledge—their private information—and to start looking instead at the actions of others and imitate them.” Decentralization: “The virtues of decentralization are twofold. On the one hand, the more responsibility people have for their own environments, the more engaged they will be…The second thing decentralization makes easier is coordination. Instead of having to make constant resort to orders and threads, companies can rely on workers to find new, more efficient ways of getting things done.”Aggregation: Crowds are useless if the diverse opinions are not aggregated in some way. This is often the downfall of decentralization: “Decentralization’s great weakness is that there’s no guarantee that valuable information which is uncovered in one part of the system will find its way through the rest of the system.”All in all, worth reading. Maybe don't try to do it overnight.

  • Al
    2019-03-16 21:57

    Maybe somewhere inside this poorly written, incoherent book, there's a decent short article waiting to be written. Who knows, maybe that article has already been written, and that's why this foolishness has been perpetrated. My heart goes out to the poor fool who had to edit this thing; that's assuming it was edited, because you really can't tell by reading it. What must it have been like before the editing? Fortunately, the basic idea isn't hard to understand, and certainly it's repeated often enough. Of course, it's also denied in various places, and then again there are numerous contradictions within the book. Not to mention at least one basic math error. But never mind. My advice: read the title and subtitle, absorb the wisdom in them, and go on to something else.I read this book, I thought, in preparation for a scheduled discussion of it at the college Homecoming weekend. That's one discussion I won't be attending. Ciao.

  • Hadrian
    2019-03-22 22:22

    Should have known better with a comparison to Malcolm Gladwell on the front.A mildly interesting idea with some neat examples, some misquotes and distortions, and nothing much aside from anecdotal evidence. This would have worked out much better as an article rather than a book.

  • Eric_W
    2019-03-12 20:21

    Updated 4/12/09. I was handing out this book to all my friends and colleagues at work, especially our president, who seemed to think a small coterie of sycophants was all he needed.From an earlier review I wrote some time ago: Wisdom of Crowds is a very insightful book about how we make decisions. The author describes the dangers of homogeneity in promoting group think, something we will begin to see more of in the Bush second administration as he builds his Cabinet with "Yes" men and women. Analysis by social scientists shows that decisions made by groups that permit little diversity are often wrong and conformity to adhere to the majority opinion can be very strong. Solomon Asch 's studies on conformity showed that an individual would often agree with the group even if there was overwhelming evidence to the contrary. For example, when presented with a card showing lines of different lengths and asked to pick the shortest one, subjects would almost always pick the one chosen by other members of the group (the experimenter's confederates) even when it was obviously not the shortest.Many of Surowiceki's arguments seem counter-intuitive, but he cites a fair amount of evidence that the best decisions, on average, are always made by groups rather than individuals regardless of their expertise. In fact, he says: "... the more power you give a single individual in the face of complexity and uncertainty, the more likely it is that bad decisions will get made."For the group decision-making process to work the best, several elements must be present.1. A formal process for encouraging disagreement must be present;2. The group must consist of stakeholders and non-stakeholders, i.e., people normally not part of the group should be present to make sure diversity of opinion is present. Diversity guarantees that multiple perspectives are brought into the decision-making process and that a broader range of information is included;3. the group must belief and see that it has the responsibility for making decisions. If the decision is made elsewhere, the result is the opposite, i.e., bad results or at least not the best;4. individuals be independent and have that independence respected to avoid being swayed by a leader or one powerful individual,5. and there be a process for aggregating the opinions. It's important that pressure to conform be suppressed.An intelligent group does not ask of its individual members to conform to the dominant view. Instead it creates a mechanism that resembles a democracy or a market. Individual group members get the opportunity to bring in their own information and opinions and are not forced to change their views. Their independence must be explicitly protected.Much like army ants in a circular mill who die from exhaustion following a lost leader, humans will often indulge in group think and group action even if it is not in their interest to do so. And the more influence we exert on one another the more likely we are to become collectively dummer. A very good argument for encouraging independent thinkers and nay sayers. The first half, or so, of the book is theory (sounds dry, but it's really quite fascinating) followed by some case studies.

  • Simina
    2019-03-18 21:59

    Există specia asta de gânditori care vor să dea o aură științifică teoriilor lor și, pentru asta, le susțin cu studii și experimente făcute de alții (în alte scopuri).Teoria aici e că anumite mulțimi, care întrunesc condițiile de diversitate (oamenii gândesc diferit, au formări diferite și un nivel diferit de cunoștințe), independență (nu sunt influențați) și descentralizare (nu au unii mai multă putere decât alții), pot rezolva cel puțin la fel de bine ca unii dintre experții din aceste mulțimi unele probleme, grupate în 3 categorii: cognitive (pot face predicții cu privire la cifre - eterna câte bile sunt în borcan/câte produse se vor vinde - sau cel mai probabil scenariu câștigător - care produs va funcționa), de cooperare (cum e plata taxelor) și de coordonare (cum sunt pietonii care nu se izbesc unii de alții pe stradă). În cazul acestor mulțimi, vocea comună tinde spre medie (părerile extreme se anulează), spre deosebire de mulțimile care se revoltă, de exemplu, unde vocea comună tinde spre extrem (cei mai agitatori și mai violenți dau tonul).Nu mi s-a părut foarte clară structura cărții, felul în care e organizată argumentarea. Probabil pentru că teoria lui e contraintuitivă, își ia multe precauții să excludă genul de mulțimi la care nu se referă teoria lui și să dea multe exemple de cazuri în care mulțimile nu ajung la adevăr - pentru că nu îndeplinesc alea 3 condiții.Una dintre aceste mulțimi, viciată de „efectul Matei” (cunoscut la noi și sub forma „banul la ban trage și păduchele la păduche” :P), este comunitatea științifică. Mi s-a părut că descrierea se poate aplica și comunității literare:„Majoritatea cercetărilor trec neobservate. (...) Lucrările cercetătorilor faimoși sunt citate mult mai des decât cele scrise de cercetători mai puțin cunoscuți. (...) Problema este că admirația pentru cel faimos este cuplată cu desconsiderarea celui mai puțin cunoscut. (...) Cu toate că această perspectivă are sens dacă ne gândim la timpul pe care îl câștigăm - nu poți să-i asculți sau să-i citești pe toți, astfel încât îi asculți numai pe cei mai buni - ea conține și un număr de presupoziții mai puțin corecte, printre care ideea că putem ști din start cine sunt cercetătorii mediocri înainte chiar de a-i asculta, și că tot ce avea de spus Fermi era inevitabil valoros.”Ca orice carte de economie, e o carte de psihologie, ceea ce e foarte plăcut :))

  • Tom
    2019-02-28 21:17

    The Wisdom of Crowds takes a scientific look at the theory that given the right composition and the right problems to solve, a group can collectively be smarter than its smartest member. It sounds like it can't be true, I know, but the author is quite convincing. The book details three different types of problems crowds can help solve:1. Cognition problems: Problems that have definitive solution, such as how many jelly beans are in this big jar?2. Coordination problems: Problems that require members of a group to figure out how to coordinate their behavior with each other, such as driving safely in heavy traffic.3. Cooperation problems: Problems that require self-interested, distrustful people to work together, even when narrow self interest would seem to dictate that no individual should take part, i.e. paying taxes or taking care of the environment.There are also necessary ingredients in a successful crowd: Diversity of opinion, independence and decentralization.There are lots of interesting examples of the above throughout the book. I found the studies on cooperation problems to be specifically interesting - the ultimatum game (p112) and the public-goods (p139) experiments are great examples of this.Still, I'm sure that after reading all that, you still have doubts, as it seems counterintuitive to think that a crowd of undetermined intelligence is smarter than a really intelligent individual. I'll leave you, dear readers, with this to think about (from the afterword, pp277-278):"The Wisdom of Crowds is not an argument against experts, but against our excessive faith in the single individual decision maker. I think there are two big problems with relying on a single individual - no matter how well informed. The first is that true experts - that is, the real titans - are surprisingly hard to identify. In fact, if a group is smart enough to know whether an individual is a genuine decision-making prodigy, then the group is smart enough not to need that individual."

  • Kathrynn
    2019-03-19 00:52

    I've debated on how to rate this book. On one hand there were interesting ideas between the cover, but on the other hand it was very dry and boring. I agree with another reviewer who mentioned it was like reading a thesis.The author separated the book into two parts: Part 1 and Part 2 and for the life of me I can't fathom why because it all ran together. The introduction starts off with numerous examples to the points he intends to make throughout the book that also have numerous--extensive--examples. A great deal of research had to go into putting the information together, but it seemed like too much name throwing and quoting with nothing to counter-balance the assumptions. There were many NFL examples (eyes rolling) and most of the examples seemed to go on forever. I got it. Enough already.On the plus side, sifting through the data of this book had me thinking about the wisdom of crowds. I agree that collective decisions are more likely to be good when made from a diverse group of individuals, reaching independent conclusions. The author's theories on becoming individually smarter, but collectively dumber were interesting. I agree that one of the quickest ways to make people's judgments biased is to make them dependent on one another for information. Another good suggestion I found in this book was reading "The Tipping Point" by Malcolm Gladwell--featured in Goodreads December 2009 Newsletter. :-)

  • Wm
    2019-03-04 20:57

    Really the best way to review this book is to just star it, right?

  • Glen Engel-Cox
    2019-03-01 02:22

    As a card-carrying member of the liberal elite, I approached James Surowiecki's book, The Wisdom of Crowds, with more than a small amount of skepticism. If his thesis, as exposed in the subtitle, "Why the Many Are Smarter than the Few and How Collective Wisdom Shapes Business, Economies, Societies, and Nations," was true, it would put all of my liberal beliefs about the importance of higher education and intelligence used by experts in the service of the greater good to a serious test. Would this book turn me from being an admirer of Al Gore into a Bush-head? The horror, the horror.Now that I've finished the book, I'm happy to say that I'm still voting for John Kerry, but I do have a higher opinion of the ability of the masses to answer perplexing problems. At the same time, I strongly feel that Surowiecki's title and thesis are somewhat disingenious, owing more to a good marketing campaign and titular wordplay than actually expressing correctly the promise of his argument. Surowiecki attempts to deflate the classic book by Charles MacKay, Extraordinary Popular Delusions Volume Three: 3, and yet only mentions this famous counter argument by name twice and then only in passing. By doing so, he fails to fully address a real flaw in his thesis: when (under what conditions, size, background, etc) is a crowd a useful body as opposed to a dangerous mob.That's not to say that Surowiecki fails to show how crowds can make smarter decisions that individual experts. Through anecdotes and discussion of controlled social experiments, he illustrates how, collectively, a group actually does much better at problem solving, mainly through the use of group error correction, i.e., while one or two members of the group might be off the answer by degrees of standard deviation, when averaging, the group as a whole comes much closer to the correct answer more often than an individual expert. In particular, his discussion of the way that markets work (in this case, not just the stock market, but Vegas betting lines as well as faux creations such as the Hollywood Stock Exchange) changed my opinion of the usefulness of these for decision-making purposes.Yet it is also in this discussion of markets that Surowiecki's argument falls flat, in that he glosses over real market problems such as the irrationality of crowds in a bull market (such as the Danish tulip craze, the 1920s boom, or the irrational exuberance of the 90s) while making the case for how the proposed DARPA Policy Analysis Market ("a market centered on the Middle East [that:] might provide intelligence that otherwise would be missed"). Surowiecki seems to me to be much more trusting of humans, whereas I'm much more inclined to believe that no matter how good a system might be, there's also that individual expert who's working on gaming the system, making it fail in ways unexpected. I only harp on this because I get the feeling in several cases (the DARPA chapter in particular, where Surowiecki's disdain for the congress people who killed the Policy Analysis Market is all too apparent) that he is championing the use of market-based decision making over our current expert-based.Reading this book did make me look at situations differently, and because of such, I'd recommend it. For example, while watching the 2004 Summer Olympics, I instantly thought of this book while watching the reaction of the crowd who felt that the judges for the individual men's gymnastics high-bar competition had not graded the Russian gymnast's performance correctly. They proceeded to boo and make noise until the panel of six judges changed their ratings. I pondered, is this an example of Surowiecki's thesis or an example of mob-rule, or, perhaps something he didn't quite cover, a little of both?

  • Shelby Boyer
    2019-03-08 02:12

    In reading Surowiecki’s The Wisdom of Crowds, I found myself finally patting myself on the back for being what I’ve always been: average. Finally—someone championing the wisdom of the little guy. The entire book is built around the idea of a crowd knowing what’s best. From figuring out how to maneuver a crowded street to finding lost submarines and judging economics, the crowd has got it down. Surowiecki makes an easily compelling case for the crowd, and he manages to do it in an entertaining way. His book is accessible to his subject matter—those common men, the lay people of the world. I am in no way an expertise, a genius, or a leader; I know very little about digital culture, politics, economics. And yet I was able to understand and—more than that—appreciate Surowiecki’s claims. Even if you don’t agree with the content (and I know some won’t), it is a well-written and enjoyable book.But, to the point. The Wisdom of Crowds highlights various situations, most of them successful, where the crowd rendered an answer either the same or better than the experts opinions. Surowiecki outlines three different types of crowds and explains why it is the crowd that makes sense of the situation. We have our Cognitive, Coordinative, and Cooperative people each with a different success story. The Cognitive is about market judgment, where the crowd is allowed to think through problems, process information, and deliver a solution as a whole. Coordination deals with common cultural understanding and awareness. It comes off as street smarts, where the crowd all knows to walk to the right without really knowing why. And the Cooperation is all about the free market (obviously supported by our Mr. Surowiecki) and the building of networks of trust. He outlines these three “crowds” and their respective successes through various examples until, finally, we feel like we—the collective we!—can do anything. Forget the pros, forget the experts. Elect us! Call on us! Stick it to the man and release the hordes! But let’s not get ahead of ourselves. After all, the crowd itself isn’t celebrated; rather, their aggregated knowledge is the champion. Even in his examples just in the forward—deciding the ox’s weight or finding the lost submarine—it wasn’t that a crowd gathered together to sort out the best answer. No. Everyone gave their individual answer, someone or some machine inputted the data, and the mean was decided upon. It was that number that was the winner. Not any one conclusion but a conglomeration—a conglomeration dependent on some geniuses mixed in with some idiots standing in a crowd with a bunch of averages. So perhaps it’s less of a revolutionary call and more of a celebration of collaboration. It’s the pat on the back from your elementary school teacher after your group project went swimmingly: it’s not about you, it’s about the end result. If it works, it worked; if not, you brush it under the rug and move on. That is both the point, the power, and the depressing reality of this book. Surowiecki tries to champion us simple-minded majority—and he does so in an enlightening fashion. It’s great to read a book about how well we’re doing, how the digital age has allowed us to open up a whole new can of possibilities. But this book is also about how the average remain average, the experts remain experts, and the idiots…well, they’re still stupid. And that's just fine. At least according to Surowiecki.

  • TarasProkopyuk
    2019-03-04 00:52

    Книга с длинным названием "Мудрость толпы. Почему вместе мы умнее, чем поодиночке, и как коллективный разум влияет на бизнес, экономику, общество и государство" весьма интересная, но как по мне в ней много фактов и данных преподнесено с неверными выводами и слабыми аргументами.Не все так плохо, автор очень четко и метко умеет подмечать моменты в жизни людей как и в отдельности так и в социуме, которые в определенных моментах склоняют тех придти к тому или иному решению, тем или иным выводам, совершить ту или иную оценку ситуации, и его острая наблюдательность способна заметить и "расшифровать" последующие влияние на умы и убеждения этих людей и масс, разложить их по полочкам. То есть в области наблюдателя в предмете поведенческой экономике автор весьма хорош, и как у журналиста у него достаточно широкие познания, но с выводами, к которым он часто приходит, я уверен, у Шуровьески достаточно они поспешные и с ошибками. У книги не хватает в этом плане серьезной доказательной базы основанной на экспериментах, а там где она есть, то она интерпретируется не совсем корректно.Но данные замечания не касаются 100% материала книги. Примерно в 50% я готов согласится с автором и подборка тем книги мне понравилась. Они весьма актуальны. То есть, если очень аккуратно и критически подойти к книге, то ее можно и даже полезно будет прочитать.

  • Christy
    2019-02-20 21:09

    We usually think that a crowd, taken as a whole, is going to be wrong. But surprisingy, if you take everybody's individual wisdom and average it together, you'll get a better answer than you'll find from an expert. We're not talking about committees here--you don't put everybody together and have them talk it out. People have to come to their decisions independently. This works whether you're guessing the number of jelly beans in a bottle, or finding a lost submarine, or trying to guess where the stock market will go. Valuable lesson: don't think anybody is stupid, unless maybe it's an "expert" who doesn't listen to the ordinary people around him.

  • Jonathan Maas
    2019-03-15 20:54

    Great book, hope for full review later. Somewhere between Jon Ronson and his big themes, and Malcolm Gladwell and his precious little truths. Regardless, it's up there with Ronson and Gladwell.

  • Ali
    2019-03-22 03:13

    I didn't expect it to be as good!Great wrap up on various case of crowds implicitly or explicitly deciding and effective factors on their optimal performance.

  • Theron
    2019-02-20 23:59

    I was skeptical when I first picked this book up. In fact, I picked it up and put it down any number of times. I picked it up and red the preface and after a short grumble, I put it down. Picked up, put down. Up down. Again. Weeks pasted before I picked it up again, knowing that there must be something of value in there, somewhere. Following a quick read, I wasn’t too disappointed. However, the first half is much better than the last half.Surowiecki starts with a mildly entertaining anecdote of Francis Galton and English country fair and a dressed-meat judging contest. He found that at the county fair, even the experts were not very good at judging the weight of an ox (dressed). What amazed him was that if the total guesses were aggregated, the average of all those guesses was remarkably correct in coming very close to the exact right answer. As in how many gumballs are in the jar – 186. In example after increasing more complex example, Surowieki proved his point – in theory and in a few best-case examples. However, he did put a LOT of caveats on the crowed that is wise. The wise crowd is: diverse, independent, decentralized, sufficiently large and must have a method of aggregating its decision. One interesting point, the crowd does not have to be full of smart people – or for that mater – any smart people.Surowieki also gives several examples of teams that fail to be wise. Most notably the mission management team of NASA during the Columbia Shuttle disaster. In summary, the Columbia Accident Investigation Board (CAIB) determined that the small team was not sufficiently diverse, and member did not operate independent from the leader, an didn’t have a method to aggregate – except through the team leader Linda Ham. In the area of diversity, Surowieki contrast the mission management team with the ground crew of Apollo 13, the later being nearly all middle-aged white males having crew cuts, white short-sleeve dress shirts, and narrow-ties. The key is and was cognitive diversity.Cognitive diversity is defined as the extent to which the group reflects differences in knowledge, including beliefs, preferences and perspectives (Miller et al 1998) [1:]. So how does one develop and maintain cognitive diversity in order to ensure the best possible decisions? Here are some simple rules:Hire diversity. Hire folks with a diverse set of skills, knowledge, experience, values, beliefs, preferences and perspectives.Maintain independence. This diversity, must be maintained and encouraged. It cannot be the goal of management to make all staff members alike.Communicate differences. Everyone on the team should know, who knows what, who prefers what, and what perspectives they hold. This is to facilitate both access to information and co-ordination.Openly listen (and talk later). The groups must actively and openly listen to the information provided by others.Encourage dissonant viewpoints. Even if the dissonant viewpoint end up being incorrect, the process of thinking through reasons strengthens decisions.Don’t seek consensus. The final decision or recommendation must come from aggregating the opinion – not seeking consensus. You must find a method of aggregating like a market place rather than a meeting.What am I missing?-----[1:] Miller, CC, Burke LM, Glick WH (1998) "Cognitive diversity among upper-echelon executives: Implications for strategic decision processes", Strategic Management Journal, Vol.19, No.1, pp39.

  • Kirk Sinclair
    2019-03-20 23:01

    Surowiecki's thesis is even more powerful than he realizes. His ingredients for decentralized wisdom are essentially the ingredients of the Scientific Revolution, participatory democracy and how we naturally learn from experience.Wow! My first review for this site was sparse. I'm expanding this review for The Wisdom of Crowds as an acknowledgment during an election week of the importance of this thesis for democracy.The ingredients for collective wisdom are: independence, decentralization, diversity and aggregation. People must think independently. Thus, the herd mentality automatically thwarts the pursuit of wisdom. Yet thinking independently does not matter much if everyone has the same centralized perspective of something. The value in independence to a democracy, for example, lies in people coming up with many different decentralized perspectives rather than be herded into a few factions/interest groups/parties.Diversity is thus a litmus test that independent and decentralized perspectives are working. Through diversity there is a spread of opinions around a norm, and there must then be a means of aggregating the diverse input to discover the norm of that spread. The norm represents a better answer than can be achieved by an expert.Think of it this way. For any given issue there is probably an "expert" or two who would advocate what is precisely the norm of the distribution, the "correct" answer if you will, but the odds weigh heavily against that. More likely an "expert's" advocacy would fall within half the standard deviation away from the norm. The only way to get precisely the norm is to allow for as much diversity as possible, through independence and decentralization, and come up with a valid and reliable means of getting the norm from the resulting distribution. Yes, you get "wacko" opinions with this method but, in addition to getting a more accurate norm through aggregation, you get something much closer to the concept of democracy than what survives our centralized institutions.Of further note: the Scientific Revolution was a rebellion against the dogma of the centralized "experts" of the time and a dramatic movement towards the independence and decentralization of knowledge. It has not been the centralizing tendencies of politics and economics that brought us much of what we think as progress today, but the independence and decentralization of the Scientific Revolution. I go into this more in Systems out of Balance.

  • MacK
    2019-03-07 00:07

    I’m trying to remember the first time I heard the phrase: “Group Think”. It might have been when a teacher pointed out a logical fallacy during a group presentation, or from a judge in a debate tournament, but I definitely remember hearing the phrase in reaction to the second gulf war and all the accusations and recriminations associated with it. Like many people, I heard that phrase and wondered: “is that the polite way of saying: ‘we all screwed up?’” Though he writes as part of the aftermath of the Iraq war, Surowiecki carefully avoids that most politically charged instance of “group think”. He instead addresses the promise and the perils of our increasingly collaborative culture, explaining the factors that help some groups discover modern marvels and lead others to massive mistakes. With the tone of a genial professor, Surowiecki explains the theory behind his argument. He quickly identifies four traits that strong groups share: diversity of opinion, independent decision making, decentralized judgement and aggregation of knowledge. The book follows an examination of these traits and offers a host of case studies that explain each factor in greater detail. These do not necessarily make for riveting reading (particularly when Surowiecki loses track of his examples and speaks in abstractions), but it does make for an interesting subject to study. I still don’t know if “group think” is just code for “we all screwed up”, much like I don’t know how to apply calculus to modern life or what lessons the Visigoths can teach us about modern government. But if there are good books that address interesting subjects, I may learn something, and that’s enough.

  • Ravi Warrier
    2019-02-28 00:21

    I started reading this book with an inherent bias. Of course, I agree with Agent Kay in Men In Black when he said, "A person is smart, people are dumb!" and that's kind of intuitive for anyone with two eyes and a brain to observe the world. And so, I was convinced I wouldn't like what 'this guy' (the author) had to say... But I changed my mind. Only because mentally I changed the title of the book.If you change the title of the book to "How to make crowds wiser", then everything that Surowiecki says in the book falls into place, like a jigsaw puzzle. In fact, he concludes it that way as well. And so, I am guessing that the current title might be either a case of "bandwagon effect" or cowering into the publisher's demands to have a catchier title.Suroweicki does a good job of balancing both sides of the argument, demonstrating when crowds are smart and when they are dumb. And it all boils down to two important factors. I won't mention those factors here, because of spoilers and because I'd be taking away James' thunder. But, the factors that he tacitly or implicitly identifies are the two factors that determine any good brainstorming session or any group that is created to solve a problem.So, I liked the book. It brought a lot of information on its pages. Most of it good. Surowiecki also took the effort to show both sides of the coin in different scenarios and walks of life and society, which was nice. It was well written, but I must admit, at places, it felt repetitive and unncessarily longer than it should have.It lost out on 4 stars only because of the misleading title.

  • James
    2019-03-22 22:02

    If a crowd is wise, then an individual writer like the author must not be? Much of the book is trite, some is just wrong. He refers to the book Moneyball and how clever Oakland was using new ideas to win more games.Like money sports is only about winning. Their #1 goal is to make as much money as possible,winning can help that,but being entertaining is more important. He admits that later in an example about Italian soccer. In Moneyball, we're told that the way to win is to walk to first base,and rarely or never try to steal a base. Who wants to go to a baseball game and watch guys WALK to first base?And stealing bases give unexpected excitement. That's not Moneyball, that's BORINGBALL. On page 127 he talks about Ernst & Young accountants,they did a crappy job, along with every one else on Wall street,but it's our fault because we "stopped watching the watchmen". The book was written in 2004, he couldn't know that another Ernstclient, Lehman brothers, had tons of liabilities off the booksso investors wouldn't know the true risk of investing in LEH. Or being a counterparty to LEH. In 2008 LEH went bankrupt. At least 600 Billion dollars in debts. At least One Million deals with counterparties. Has Ernst been held accountable in any way? No. Is that our fault too? The book is a collection of a hundred little stories that don't really fit together.I'm glad I didn't buy this book, back to the library.

  • Gary
    2019-03-21 01:01

    The book is highly listenable but suffers greatly from events which have transpired in the years since its original publication (2005 vs. today 2013). The financial crisis and stock market crash really do poke holes in a lot of his narrative on how groups out perform individuals.I would not recommend using a credit today for this book because it is outdated by recent events and we have evolved technologically since those days. I do like the authors main theme that groups out perform individuals but he would first need to rewrite his story to explain recent history and include recent tech innovations.The narrator is one of my favorites and he will make it easy to listen to the whole book in spite of the anachronisms in the narrative.

  • Laura
    2019-02-25 00:04

    An interesting book that presents compelling arguments in favor of drastically overhauling the way group decision-making is commonly practiced in American schools and workplaces in order to enhance the possibility of better outcomes. Anyone who has ever worked in a group will recognize many of the dynamics he describes - from the dominance of those who speak the most (regardless of the merits of the content they contribute) to unconscious deference to those of higher status (regardless of whether their expertise pertains to the problem at hand). With examples drawn from many spheres of life this is a practical and engaging book.

  • Zach
    2019-02-28 03:20

    This is a great book. Well worth the read.Still, I can sum it in a couple of sentences, and then you only need to read it if you want the supporting arguments.Large groups of people tend to arrive at the correct resolution to complex issues far more frequently than individuals do. This happens when the wrong answers are randomly distributed, and the experts cast the deciding votes. You would be surprised how often this happens. Read the book for cases to keep an eye on biased wrong answers ruining this usually good strategy for finding optimal solutions.

  • Rob Hunter
    2019-03-05 20:52

    The ideas in this book helped set a direction of thought that affected the software industry (particularly the Silicon Valley scene, which had outsized impacts on the rest of the world). Reading it through now reminds me how much is lost in lip service – it's clear that so many "crowd-sourced" and "social" solutions took the title as if it were the whole story. They missed the critical conditions that allow a crowd to be wiser than the individuals within it.(aka, no, the Central Limit theorem does not apply to dependent variables.)

  • Adam
    2019-03-17 01:57

    A brilliant, thought-provoking survey of the many ways in which a kind of group intelligence emerges, leading to smarter groups, economics, even democracy. Well worth reading, if only to get past the cliche of "wisdom of crowds" to understand the circumstances under which this works, and those under which it goes terribly wrong.