The Wisdom of Crowds

I read this book in a day and a half- I found it enthralling at first and then a bit of a drag, precisely because he promises much right at the beginning and then as one begins to unravel his arguement about so called 'wisdom of crowds', you realize he's only packaging some pretty basic statistical tools of sampling and behavioral economics in a commonsensical manner. Not that it doesn't require skill to do that- it does and he has a great story telling technique but the book falls short of making you think differently, something that Gladwell does quite brilliantly in both The Tipping Point and Blink.

So what exactly is the thesis of the book. I am reproducing here a short summary from Publisher's Weekly thats pretty good.

"While our culture generally trusts experts and distrusts the wisdom of the masses, New Yorker business columnist Surowiecki argues that "under the right circumstances, groups are remarkably intelligent, and are often smarter than the smartest people in them." To support this almost counterintuitive proposition, Surowiecki explores problems involving cognition (we're all trying to identify a correct answer), coordination (we need to synchronize our individual activities with others) and cooperation (we have to act together despite our self-interest). His rubric, then, covers a range of problems, including driving in traffic, competing on TV game shows, maximizing stock market performance, voting for political candidates, navigating busy sidewalks, tracking SARS and designing Internet search engines like Google. If four basic conditions are met, a crowd's "collective intelligence" will produce better outcomes than a small group of experts, Surowiecki says, even if members of the crowd don't know all the facts or choose, individually, to act irrationally. "Wise crowds" need (1) diversity of opinion; (2) independence of members from one another; (3) decentralization; and (4) a good method for aggregating opinions. The diversity brings in different information; independence keeps people from being swayed by a single opinion leader; people's errors balance each other out; and including all opinions guarantees that the results are "smarter" than if a single expert had been in charge. Surowiecki's style is pleasantly informal, a tactical disguise for what might otherwise be rather dense material. He offers a great introduction to applied behavioral economics and game theory. "

If you actually analyze the four conditions he talks about, those are just good statistical techniques anyway. In that sense, the title of the book is a misnomer- its not just crowds that he is talking about, he is talking about a sample of people with diversity of opinion, complete independence and also having a good method of aggregating data. All these are simple reassertions of mathematical principles and applying them in social theory, albeit interesting, is not quite pathbreaking.

One thing is for sure- Surowiecki has a great gift for story telling and is able to explain complex social experiments in a very simple, understandable manner that makes these experiments so much more appealing and less esoteric. Just for that, if not anything else, this book is worth reading but don't expect a classic!