The wisdom of the crowd refers to the process of taking into account the collective opinion of a group of individuals rather than a single expert to answer a question. This process, while not new to the information age

Information Age

The Information Age, also commonly known as the Computer Age or Digital Age, is an idea that the current age will be characterized by the ability of individuals to transfer information freely, and to have instant access to knowledge that would have been difficult or impossible to find previously...

, has been pushed into the mainstream spotlight by social information sites such as Wikipedia

Wikipedia

Wikipedia is a free, web-based, collaborative, multilingual encyclopedia project supported by the non-profit Wikimedia Foundation. Its 20 million articles have been written collaboratively by volunteers around the world. Almost all of its articles can be edited by anyone with access to the site,...

 and Yahoo! Answers

Yahoo! Answers

Yahoo! Answers is a community-driven question-and-answer site or a knowledge market launched by Yahoo! on June 28, 2005 that allows users to both submit questions to be answered and answer questions asked by other users...

, and other web resources that rely on human opinion. The process, in the business world at least, was written about in detail by James Surowiecki

James Surowiecki

James Michael Surowiecki is an American journalist. He is a staff writer at The New Yorker, where he writes a regular column on business and finance called "The Financial Page".-Background:...

 in his book The Wisdom of Crowds

The Wisdom of Crowds

The Wisdom of Crowds: Why the Many Are Smarter Than the Few and How Collective Wisdom Shapes Business, Economies, Societies and Nations, published in 2004, is a book written by James Surowiecki about the aggregation of information in groups, resulting in decisions that, he argues, are often better...

.

Definition of crowd

The term crowd, in this usage, refers to any group of people, such as a corporation, a group of researchers, or simply the entire general public. The group itself does not have to be cohesive; for example, a group of people answering questions on Yahoo! Answers may not know each other outside of that forum, or a group of people betting on a horse race may not know each others' bets, but they nevertheless form a crowd under this definition.

Benefits

The wisdom of the crowd applies to democratic journalism

Democratic journalism

Democratic journalism is a term describing a relatively new phenomenon where news stories are ranked by a vote among the stories' readers . This phenomenon has been brought about largely due to the creation of social networking sites such as Digg and Newsvine....

 in that a group of non-experts determine what news is important, and then people outside the group can view the news based on those rankings. The social news sites Digg

Digg

Digg is a social news website. Prior to Digg v4, its cornerstone function consisted of letting people vote stories up or down, called digging and burying, respectively. Digg's popularity prompted the creation of copycat social networking sites with story submission and voting systems...

 and Newsvine

Newsvine

Newsvine is a community-powered, collaborative journalism news website, owned by msnbc.com, which draws content from its users and syndicated content from mainstream sources such as The Associated Press...

both fall into this category and rely heavily upon the wisdom of the crowd in creating their content.

Problems

The crowd tends to make its best decisions if it is made up of diverse opinions and ideologies. A crowd of like-minded individuals may contain bias, which can cloud their judgment and cause a less useful response to a given question. Crowds tend to work best when there is a correct answer to the question being posed, such as a question about geography or mathematics.
The effect is easily undermined. Social influence can cause the average of the crowd answers to be wildly inaccurate, while the geometric mean and the median are far more robust.