A long time ago, in a more aristocratic era, Henry David Thoreau lamented that "the mass never comes up to the standard of its best member." But in the age of the Internet, people are more inclined to believe that the decentralized efforts of large groups can be better than the work of experts. Wikipedia has edged out traditional encyclopedias; eBay can value your car better than a local used-car dealer. And politicians have a special reason to respect the wisdom of markets. Amateur traders on the University of Iowa's political futures market predict elections more accurately than professional pollsters.
Read James Surowiecki's excellent book The Widsom of Crowds for more on this. It provides an excellent, intuitive introduction to why decentralized systems such as markets and decntralized forms of government typically make much better decisions than more centralized decision-making systems.
(HT Russ Roberts)
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