Is there wisdom in crowds?

I’m a huge fan of Shane Parrish’s Farnam Street blog and in a great post about how to make good decisions, he talks about the power (or not) of the crowd:

Is there a wisdom of crowds? Some say yes, others say no. My view is that crowds can be very useful if individual members of the crowd are able to vote independently or if the environment is such that there are few repercussions for voicing disagreement. Otherwise, I think signaling effects from seeing how others are “voting” is too much evolutionary force to overcome with sheer rational willpower.

In other words, the herd mentality often outweighs the benefit of lots of views.

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