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Crowd Wisdom
Crowd wisdom describes the idea that combining information and judgements from many participants can sometimes produce estimates that are more accurate than those of individual participants.
Why it matters to you
Prediction markets attempt to aggregate different views through prices. But crowds are not automatically correct. The quality of the resulting estimate can depend on who participates, what information they possess, their incentives, liquidity and whether participants are independently evaluating the evidence.
Terms that sit next to this one
Wisdom of Crowds
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