Stuck in the Wisdom of Crowds: Information, Knowledge, and Heuristics

39 Pages Posted: 14 Feb 2022 Last revised: 19 May 2022

See all articles by Yunwen He

Yunwen He

Tsinghua University

Jaimie W. Lien

The Chinese University of Hong Kong (CUHK) - Department of Decision Sciences & Managerial Economics

Jie Zheng

Tsinghua University - School of Economics & Management

Multiple version iconThere are 2 versions of this paper

Abstract

Collective knowledge is significantly affected by information about others’ viewpoints. However, under what conditions does the “wisdom of crowds” help versus harm knowledge of factual information? In this experiment, we present subjects with the task of answering 50 factual true or false trivia questions, with the potential opportunity to revise their answers after receiving different levels of information about other subjects’ answers and self-assessed confidence levels from an independent session. We find that information about others’ answers improves performance on easy questions, but tends to harm performance on difficult questions. In addition, information about answers provided by other subjects mainly improves performance for those with lower initial knowledge levels. Subjects in our Moderate-Information condition outperform those in either the Low or High-Information conditions, implying an optimal level of social information provision, in which the Majority Rule and Maximum Confidence rule complement one another. Although the Maximum Confidence rule can improve performance, yielding the lowest overall error rate out of the heuristics considered, subjects generally underutilize the information on other subjects’ confidence levels in favor of the Majority Rule heuristic. These findings shed light on possible directions for policies that can cultivate factual knowledge on online opinion platforms.

Keywords: wisdom of crowds, information provision, decision heuristics, majority rule, surprising popularity, maximum confidence

Suggested Citation

He, Yunwen and Lien, Jaimie W. and Zheng, Jie, Stuck in the Wisdom of Crowds: Information, Knowledge, and Heuristics. Available at SSRN: https://ssrn.com/abstract=4034565 or http://dx.doi.org/10.2139/ssrn.4034565

Yunwen He

Tsinghua University ( email )

Beijing
China

Jaimie W. Lien

The Chinese University of Hong Kong (CUHK) - Department of Decision Sciences & Managerial Economics ( email )

Shatin, N.T.
Hong Kong

Jie Zheng (Contact Author)

Tsinghua University - School of Economics & Management ( email )

Beijing, 100084
China

HOME PAGE: http://jzheng.weebly.com/

Do you have a job opening that you would like to promote on SSRN?

Paper statistics

Downloads
12
Abstract Views
72
PlumX Metrics