The Wisdom of Group Blogs

Wisdom of Crowds author James Surowiecki is guestblogging at Marginal Revolution.

Comments

[Ken Shultz]

There’s a review of this book in the NYRB as well.

According to the review in the NYRB, he points out that when guessing the number of jelly beans in a jar, for instance, the average of the individual guesses is often closer to the actual number than the closest individual guess. That?s an interesting idea.

I’m not sure how to account for that, and I intend to read this book, but my gut reaction is that it’s something like what we see with the performance of the S&P 500 when tracked against actively managed funds trading in the same asset class. Of course, there aren’t many actively managed funds that outperform the S&P 500 in any given year, and there are only a few that consistently outperform it over a decade.

It can be argued that actively managed funds vs. the S&P 500 are like centrally planned economies measured against free markets. Maybe the invisible hand is at work here, telling us the number of jelly beans in the jar. But if that?s the case, it’s an argument for individual freedom, not an argument against individual judgment.

[Hank Reardon]

the National Drug Control Office is on to this group concept as well. Their new ad explains that kids in groups are less likely to develop drug addictions. Unfortunately, kids in groups are also less likely to develop the necessary respect for individual rights that made this country great. The schools are hard at work trying to eliminate our individualistic tendencies, in an effort to guarantee an ignorant, Democratic voting base. Shame on the GOP drug hounds for joining the fight against individualists.

[David]

Richard Posner is guest-blogging at Lawrence Lessig’s blog:

http://www.lessig.org/blog/

[gaius marius]

reading this book was for me a painful experience. it became extraordinarily clear that the author has fallen completely into the rousseauian religion of proletarian superiority.

the clue that is had transcended idea and crossed into religion was his assertion that crowds and markets can accurately predict the unknowable.

that should be a clue to any reasonable skeptic that this is nonsense, and that the worship of the individual has gone well into the absurd.