Informational Cascades

I may be late to the party on this one but I came across a concept I hadn't really given any thought to recently - its the idea of informational cascades.  John Tierney of the New York Times explains it this way:

We like to think that people improve their judgment by putting their minds together, and sometimes they do. The studio audience at “Who Wants to Be a Millionaire” usually votes for the right answer. But suppose, instead of the audience members voting silently in unison, they voted out loud one after another. And suppose the first person gets it wrong.

If the second person isn’t sure of the answer, he’s liable to go along with the first person’s guess. By then, even if the third person suspects another answer is right, she’s more liable to go along just because she assumes the first two together know more than she does. Thus begins an “informational cascade” as one person after another assumes that the rest can’t all be wrong.

Because of this effect, groups are surprisingly prone to reach mistaken conclusions even when most of the people started out knowing better, according to the economists Sushil Bikhchandani, David Hirshleifer and Ivo Welch. If, say, 60 percent of a group’s members have been given information pointing them to the right answer (while the rest have information pointing to the wrong answer), there is still about a one-in-three chance that the group will cascade to a mistaken consensus.

I came across that doing a bit of research on Gary Taubes book Good Calories, Bad Calories and Tierney uses informational cascades as an explanation for the conventional wisdom that a high-carb low-fat diet is good for you, when a massive body of research says otherwise.

In that same article he says that the global warming crusade is an example of an information cascade. He's also got a piece from Arthur Schopenhauer on informational cascades and points to a paper in The Journal of Political Economy on the subject (I haven't read it so can't say anything about it one way or another).

Here's the venerable Wikipedia entry on informational cascades.

And here's the mother lode for all things on informational cascades.

Although not the same subject exactly, this dovetails with an article I came across called "Your Brain is Not Your Friend," which is a short and fun intro to the many ways we can fool ourselves.

This definitely dovetails with a post Kathy Sierra did before she went into retirement/hiding/seclusion (come back Kathy, please!) called "The Dumbness of Crowds," wherein she points out the following:

All geeks-and-personal-hygiene-jokes aside, we need the smell. And the most frustrating part for me is how the "Wisdom of Crowds" idea has been twisted and abused to mean virtually the opposite of what New Yorker columnist James Surowiecki says in the book of the same name. He opened a talk at ETech telling us that while ants become smarter as the number of collaborators increases, humans become dumber. In what is potentially the most misleading book/idea title in the history of the world, the "Crowds" in "The Wisdom of Crowds" was never meant to mean "mobs", "groups acting as one", "committees", "consensus" or even "high collaboration".

And it falls in line with Marc Andreesson's semi-famous post on the ill effects of brainstorming (I posted on it here).

The whole "informational cascade" concept is a potentially powerful paradigm and powerful tool that could be put in service by nearly anyone with an agenda.  In other words, religious people could blame atheism on informational cascades and vice versa, liberals could blame conservatism on informational cascades and vice versa, and so on and so on.  Still, though the concept is subject to abuse and to be used to service anyone with an agenda its worth looking at to help understand why things are the way they are.  In my little religious corner of the universe might one argue that the growth of the emergent church is at least in part due to an informational cascade?  Or could emergents argue that they are resisting an informational cascade that has been going for hundreds of years?  Was that big decision we made at church influenced by an informational cascade?  And of course, most importantly, are the current college football rankings and BCS standings the result of informational cascades?

 

 

 

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Tags: Religion, theology, informational cascades, sociology, society, politics, politics & society, crowds, wisdom of crowds, John Tierney

Comments

[IndyChristian]

And if I read your blog-post and concur... am I more likely right? Or wrong? **smile**

Thanks for the thought-provoking blog-post, David. (I think.) I've tagged it for future consideration in our New Media course.

We need to pause and consider though, how Wikipedia (now 10 times as many subjects as the Encyclopedia Britanica) is as accurate as they are (4 errors vs. 3 errors in E.B.). Seems like a great self-correcting mechanism over time.

[David Wayne]

Oh man, with me you are probably wrong.

I did not know that about Wikipedia. I had heard that it was fairly accurate but I hadn't seen hard numbers. I have seen several warnings of late to be careful about trusting Wikipedia.

One interesting train of thought on this would be to look at Wikipedia through the lens of informational cascades, but I think Marc Andreesson's article on brainstorming may be more on point. He says that when you get a bunch of people together in a group things don't go as well, maybe informational cascades play a role there. But, more and better ideas are generated by many individuals working in isolation from one another, which is similar to what is happening with Wikipedia.

Wikipedia also fits very well into the definition of a starfish organization, a la The Starfish and the Spider.

Where'd you get the numbers on Wikipedia vs. E.B.?