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The Wisdom of the Crowd

I have always been suspicious of what has become almost conventional wisdom that there is something called the “wisdom of the crowd.” It is generally interpreted to mean that the collective somehow knows what is not knowable by any individual. That notion is one of the motivating factors that recommends democracy to some. I disagree: I think the crowd collectively does not “know” since the act of knowing applies to individuals and not to abstract collectives. (Actually, it is superfluous to write “abstract collectives” since there are no other kinds of collectives; all collectives are abstractions.) Each individual knows something but those particularized “knowings” cannot be meaningfully aggregated to something that can be called the “knowledge of the crowds” or some such.

In any case, I interpret the “wisdom of the crowd” to mean that individuals in the crowd have different understanding of any particular matter and therefore some particular individual knows the best (however defined) about it. That bit is axiomatic and does not need further elaboration. What does need stressing is that ex ante we don’t know who among the crowd is the one who knows best regarding that particular matter. If everyone among the crowd has the opportunity to demonstrate their understanding, we (not collectively but as individuals each making our own judgement) could recognize ex post who knows best.

That is one of the many reasons why liberty and freedom of the individual is important. Liberty for people to demonstrate their understanding (through their actions of course), and the liberty for people to assess for themselves the actions of others. Since nobody knows a priori what or who is best, the most we can do is to have the liberty to explore the space of possibilities and then choose what to accept. Freedom is instrumental in this venture. Hayek makes the case for freedom with his characteristic elegant eloquence:

If there were omniscient men, if we could know not only all that affects the attainment of our present wishes but also our future wants and desires, there would be little case for liberty. And, in turn, liberty of the individual would, of course, make complete foresight impossible. Liberty is essential in order to leave room for the unforeseeable and unpredictable; we want it because we have learned to expect from it the opportunity of realizing many of our aims. It is because every individual knows so little and, in particular, because we rarely know which of us knows best that we trust the independent and competitive efforts of many to induce the emergence of what we shall want when we see it. [Source: The Case for Freedom. Oct 1960.]

Go read that essay very seriously. You’ll be much wiser than the crowd. (I should take this opportunity to plug another book that I think all smart people should read — Gustave Le Bon’s THE CROWD: A STUDY OF THE POPULAR MIND. 1896.)

Atanu Dey on India's Development

Atanu Dey
Chapters
PJ O’Rourke: Every government is a parliament of whores The Amazing Power of Technology Swami Vivekanand: To the 4th of July No True Islamic State Herbert Simon — Information consumes attention Yoga has no Religion Hayek on “The Mirage of Social Justice” An Open Letter to PM Shri Modi Prefer a Functioning Economy Political Discrimination is Socially Harmful Markets & Competition Ministry of Power, Coal, and New and Renewable Energy John Stuart Mill on the Liberty of Thought and Discussion Reading Ronald Coase Universal Literacy Man versus the State What Comes Before An ad from 1947: “The Uphill Task Ahead” Pohela Boishakh, Vishu, and Puthandu Greetings Rich People Spend More Goodbye, Mr Lee Kuan Yew Friday the 13th, Pi Day the 14th & Beware the Ides of March Money is the root of all Evil Warren Buffet’s Letter to the Shareholders The Man Lee Kuan Yew Admires the Most An Informed Citizenry is the Bulwark of a Democracy Problems and Solutions People I Admire – Part Doh Nelson Mandela on Education Criticizing Modern Indian Holy Cows Considered Dangerous Richard Dawkins on the Monotheistic God List of Pages on Teresa the Merciless People I Admire Lee Kuan Yew is under Intensive Care On Monkeys, Cats & the Generality Principle The Great Indian Bamboozle has to Stop 2400 hours of electricity for Delhi — every year? Make India first to “Make in India” Republic Day Thoughts on Reading the Constitution A Day of Shame and National Mourning for India The most dangerous man to any government Socialism, Competition and Politicians Open Thread: Ask me anything Aakash, the “iPad Killer”, Vaporware has Evaporated The Dreamer and the Dream Circular Firing Squad of Flying Attack Monkeys Target Rajiv Malhotra We need more Anandamide, not Jihadamide Constitutions Matter in our Daily Lives The Only Home We’ve Ever Known Adam Smith on the Division of Labor The Passing of Former President Mr APJ Abdul Kalam Socialism Works its Wonders in Venezuela - also in West Bengal Why the terrorists killed the satirists of Charlie Hebdo Islam Poses an Existential Threat The Wisdom of the Crowd On Knowing Enough to Know that You Don’t Know NITI — New Initiatives for Transforming India Will India Recover? The Unbearable Stupidity of Controlling Prices Nov 14th as the “Day of Shame and Lamentations for India.” The Indian Constitution — Part 2 Hayek on Valuing Individuals Mr Modi goes to Washington