18 Mar 2006

wisdom of crowds

i went down to london on friday night, and on the train i didn't feel like working so i put on one of two "south by southwest interactive" (SXSW 2006) podcasts i downloaded earlier in the week to listen on my ipod, and boy was that interesting.

if you haven't heard about wisdom of crowds, do yourself a favour and read up on what it is about or even better, listen to the podcast or watch the video from SXSW2006 of the talk given by James Surowiecki on his book, Wisdom of Crowds.

basically, he describes a phenomenon which contradicts the belief that the collective intelligence of a large group of non-experts can exceed the intelligence of an expert when it comes to solving problems. the caveat is that this will only happen under certain circumstances, and these conditions are not preposterous. the talk itself is very interesting because James Surowiecki is a very good speaker, so you definitely won't get bored.

in the talk he relates the content of the book to how the internet can be used to forecast events or problems. he mainly argues based on anecdotes, so it isn't clear whether it is real phenomenon, or just in corner cases.

this is definitely something intriguing that i want to investigate. i'm going to get his book to read more about it. you can think of a couple of new sites that work on this, such as digg.com.

one further note, he mentions something about hollywood stock exchange (HSX), i actually remember playing this for a year back in 2000. i didn't realise that i was actually involved in a special kind of prediction market.

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