There's an engaging (and brief) video interview with James Surowiecki who wrote The Wisdom of Crowds : How Collective Wisdom Shapes Business, Economies, Societies and Nations.

It's a central tenet of the Don't Be Evil site that open access to accurate information will improve how business, politics and the media function.

The book argues that a group as a whole is smarter than the smartest individual people in the group. The book argues against the theme of Extraordinary Popular Delusions & the Madness of Crowds.

The author cites the stock market as one example. Even though the market swings between the extremes of despair and mania, over time it's hard to beat the collective wisdom of the market.

The author claims that a group estimating the number of jelly beans in a jar is usually within 2% of the correct answer, while it is unlikely that any individual will be that accurate. The over- and under-estimation of individuals cancels out, leaving a relatively accurate group consensus.

Google uses a similar approach to discover the most relevant web sites for its search engine by allowing all sites in the index to "vote" on each page's relative value.

Surowiecki argues that for a group to be effective, each individual must do their own research and arrive at their own opinions independently. Once people start "following the crowd," the "information cascades" will warp the ability of the group to reach a valid consensus.

Surowiecki is a big proponent of the Google Dutch auction to place their IPO, because it relies on thousands of individuals doing their own research to determine the market price. Surowiecki believes this will result in a better price for Google, and a price closer to the actual market price of the stock post-IPO.

So if you're an individual investor, Surowiecki advises to invest in index funds (boring), or try to discover areas where the market is just following the crowd and exploit the resulting price distortions.

Surowiecki argues that today's polarized political environment is causing the presidential candidates to retreat to a small number of advisors instead of engaging the public with their proposals. Consequently, they will not benefit from the wisdom of the population, and are likely to make poor decisions when judged through the lens of history.