More Wisdom of Crowds

Posted by on Aug 28, 2008 in Uncategorized | No Comments

BarackMccain
 I've heard lots of odd distortions of the basic idea at the heart of James' bestseller recently – mostly, of the "you see, crowds are stupid after all…" variety

Most of these ignore the fact that one of the main points that the book makes is that circumstances are important: it's not just any old bunch of folk, organised any which way that makes for collective wisdom

Just as Clay and Charlie's mass collaboration stuff has certain conditions necessary for success, so does the kind of collective guesswork that James used to first articulate what we mean by the wisdom of crowds. So please no more stupid "the crowd is stupid" comments…

Which brings me on to the graph above. The Iowa Electronic Markets (which James refers to) harness the WoC with some predictive success – for the past 4 or 5 presidential elections they've been closer to the final outcome on 3 out of 4 days than the polls…

So with all this excitement in Denver I wonder if anyone's been watching the IEM?

PS I've told the story before about how Muiry won money in 2004 by following the IEM's predictions which we'd been discussing and I – fool that I am – refused to believe the data and ended up with nowt.

Think it's time to pop down the bookies now…