Why do groups of humans sometimes exhibit collective wisdom and at other times madness? Can we reduce the risk of maladaptive herding and at the same time increase the possibility of collective wisdom?
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Understanding this apparent conflict has been a longstanding problem in social science. The key to this puzzle could be the way that individuals use information from others versus information gained from their own trial-and-error problem solving. If people simply copy others without reference to their own experience, any idea – even a bad one – can spread. So how can social learning improve our decision making? Striking the right balance between copying others and relying on personal experience is key. Yet we still need to know exactly what the right balance is.
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Our results suggest that we should be more aware of the risk of maladaptive herding when these conditions – large group size and a difficult problem – prevail. We should take account of not just the most popular opinion, but also other minority opinions. In thinking this way, the crowd can avoid maladaptive herding behaviour. This research could inform how collective intelligence is applied to real-world situations, including online shopping and prediction markets.
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