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Derren Brown abuses The Wisdom of Crowds

One of Derren Brown's recent Events was to 'correctly' guess the winning six number of the UK National Lottery. Brown attributed his success to the wisdom of crowds. On his website he has the following piece

Crowd behaviour is often associated with irrationality. Crowds form mobs and cults. They panic and the herd instinct is often wrong and easily swayed. At least that is the common perception. But scientist and polymath Francis Galton discovered that not all crowd behaviour was negative. Indeed he found that if you asked enough people the same question, they might come up with better answers than even the experts.

It was in 1906 that Galton made his discovery of what is known as the wisdom of crowds. He attended a farmers' fair in Plymouth where he was intrigued by a weight guessing contest. The goal was to guess the weight of an ox when it was butchered and dressed. Around 800 people entered the contest and wrote their guesses on tickets. The person who guessed closest to the butchered weight of the ox won a prize.

After the contest Galton took the tickets and ran a statistical analysis on them. He discovered that the average guess of all the entrants was remarkably close to the actual weight of the butchered ox. In fact it was under by only 1lb for an ox that weighed 1,198 lbs. This collective guess was not only better than the actual winner of the contest but also better than the guesses made by cattle experts at the fair. It seemed that democracy of thought could produce amazing results.

However, to benefit from the wisdom of crowds several conditions must be in place. First each individual member of the crowd must have their own independent source of information. Second they must make individual decisions and not be swayed by the decisions of those around them. And third, there must be a mechanism in place that can collate these diverse opinions.

Internet search engines are a good example of the wisdom of crowds in action. It is the reason the pages you search for come up near the top of the search engine list.

In general terms the more people are linking to a page and the more popular it is the higher it comes. Another highly visible example of crowd decision making can be found in the television game show Who Wants To Be A Millionaire. When the player does not know which one of four answers is correct, they can ask the audience. Each member of the audience makes a separate and individual vote for the answer they favour. These votes are then collected and the results displayed. Often it is obvious from the result that one particular answer has found favour. And that is the one the player generally goes along with. In 95% of cases it is correct.

Our Hero: James Surowiecki

Our hero goes on the offense. On the radio (start at 26:30 until 32:00).

An attack from a medical pathologist.

Short introduction from a nice man with a beard

Not all crowds are wise!

http://linuxinsider.com/story/66974.html

The Rhythm of Crowds

The Wisdom of Crowds and Football Management

Here are reports from the BBC and the Wall Street Journal on the sale of Ebbsfleet United to 20,000 members from the MyFootballClub.com website. There are now more than 30,000 members. The members pick the team each week. The "lame duck" manager is former Republic of Ireland international (5 caps) Liam Daish. This is the blurb from the club website

As a MyFootballClub member, you will be part of a unique website community, the first in the world to purchase a football club. You will join over 30,000 members living in 130 different countries, all of whom get to vote on key decisions, from team selection to financial budgets. Before every match, MyFootballClub members have a say in team selection. They can back the coaching staff's judgement, or choose to pick the team and formation themselves. Members also get to vote on other fundamental decisions, from setting a weekly playing budget (£10,000 this season) to deciding on season ticket prices to approving Nike as the club’s supplier and its designs. MyFootballClub members communicate on its thriving forums, which have around 25,000 forum posts from members each month. Members can also set up special interest groups as well as talk in its chatroom.

This truly is the wisdom of crowds in practice - and it seems to be working! Last season the club won the FA trophy for the first time. This September the club became the first to have a publicly voted transfer. 82% of members voted in favour of Ebbsfleet selling John Akinde to Bristol City for £150,000 (plus add-ons). This was a world's first, where the fans had the final say in a transfer deal. Over 7,000 members voted in 48 hours.

You can read more about this and other similar schemes on Wikipedia here. The actual website of MyFootballClub can be accessed here and the official website of the club they currently own Ebbsfleet is here. Ebbsfleet United are currently 23th or second last (as of the 19th November) in the Blue Square Premier League table.

This will be a real test for the Wisdom of Crowds and it is clear that not everyone thinks it will be a success, see here.

The Wisdom of 12 Angry Men

The four key requirements for the wisdom of crowds are:

1. Diversity
2. Independence
3. Specialisation
4. Aggregation

How does this hold up in a jury where 12 people must reach a collection verdict? A classic film may provide the answer. If you have the film channel TCM (Turner Classic Movies) or similar you may have come across the 1957 film Twelve Angry Men.

This is a great film. It's about justice and doing what's right and the transcendence of ordinary people. Plus, it has great speeches just littered all through it. It's also a classic example of the wisdom of crowds.

One of the things I noticed this time through--maybe because I'd just finished reading The Wisdom of Crowds is how much depends on the different experience and knowledge of the men in the room--the old man(Joseph Sweeney) knows what it's like to be a forgotten old man, Jack Klugman knows how to use a switchblade, Henry Fonda used to live next to an 'El' train line. They were poor men and immigrants and business men and laborers. They each brought knowledge with them that others didn't bring. They each observed different things in the courtroom, they each had different prejudices (which meant that their prejudices would be questioned, not just taken for granted.

They were diverse. They were independent - they had never met before their jury duty and they didn't even know each other's names until Henry Fonda and Joseph Sweeney introduce themselves as they're leaving the courthouse. Henry Fonda broke them out of 'groupthink' and gave them the opportunity to bring their special knowledge to bear on the situation. And they were locked in a room until they came to an agreement - making aggregation a necessity.

You can watch this classic film online here.