From Wisdom to Wisdom of the Crowd and Crowdfunding

Journal of Communication and Computer, Forthcoming

Posted: 6 Dec 2011 Last revised: 24 Nov 2017

See all articles by Clemens Bechter

Clemens Bechter

Thammasat University - Faculty of Commerce and Accountancy

Stefan Jentzsch

Perella Weinberg Partners

Michael Frey

University of Freiburg

Date Written: May 24, 2011

Abstract

This research aims at encouraging the academic community to broaden the body of knowledge by bridging the gap between IT (social networks), finance (crowdfunding) philosophy, and cultural distances. Western philosophy treats wisdom as outcome of knowledge and judgment about uncertainty. Asian philosophy treats wisdom as an outcome produced by a wise person; wise persons such as teachers are approximations to wisdom but not wisdom in itself. Whereas some philosophers stress the idea of individual wisdom e.g., Sun Tzu and Nietzsche, others e.g., Confucius and Kant point into another direction: the wisdom of the group or crowd. Surowiecki (2005) states that the averages of individual guesses of the crowd display more wisdom than individuals, even more than most competent experts. Applications of the wisdom of crowds are currently found in three major categories: prediction, crowdsourcing, and crowdfunding; all supported by social networks and the network effect. The authors’ empirical research focused on crowdfunding. In a study, post-graduate executives had to draft business plans of their choice being financed by crowdfunding. Preliminary findings suggest that the usage of Twitter and Facebook correlates with each other. One cluster, predominantly South-Asians, make less use of social networks for promoting crowdfunded projects than the other group, namely, East-Asians and Europeans. Two third of proposed projects dealt with commercialization of a product or service, remaining part being non-profit ones. Wisdom of the crowd follows a bottom-up approach whereas classical philosophy a more top-down orientation. Bridging the gap will be a major challenge. Confucius and Kant, although not being exposed to the capabilities of today’s social networks, show high appreciation of the wisdom of the group/crowd. However, there are certain parameters to be implemented if the crowd should arrive at wise decisions.

Keywords: Crowdfunding, wisdom, philosophy, crowd, cross-cultural

Suggested Citation

Bechter, Clemens and Jentzsch, Stefan and Frey, Michael, From Wisdom to Wisdom of the Crowd and Crowdfunding (May 24, 2011). Journal of Communication and Computer, Forthcoming, Available at SSRN: https://ssrn.com/abstract=1851142

Clemens Bechter (Contact Author)

Thammasat University - Faculty of Commerce and Accountancy ( email )

Bangkok, 10200
Thailand

Stefan Jentzsch

Perella Weinberg Partners ( email )

401 Congress Ave
Suite 3000
Austin, TX 78701
United States

Michael Frey

University of Freiburg ( email )

Freiburg
Germany

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