|WikiProject Economics||(Rated Start-class, Low-importance)|
|WikiProject Computing||(Rated Start-class)|
This article should be rewritten - it's hard to understand (especially the second and the third paragraph - I really couldn't make a head or tail of them). More explanations and examples are needed. Pako 15:20, 17 May 2006 (UTC)
- It seems ok now, but would benefit from explaining if Hayek originated or popularised the term. - Rod57 (talk) 21:43, 25 September 2012 (UTC)
- I'm curious why you don't think it's relevant? It provides the perfect example to help people understand the concept. From the Wikipedia article on Jimmy Wales...
- Wales cites Austrian School economist Friedrich von Hayek's essay "The Use of Knowledge in Society", which he read as an undergraduate, as "central" to his thinking about "how to manage the Wikipedia project". Hayek argued that information is decentralized – that each individual only knows a small fraction of what is known collectively – and that as a result, decisions are best made by those with local knowledge rather than by a central authority. --Xerographica (talk) 05:32, 27 September 2012 (UTC)
I was expecting to see some comparison between the topic of this article and emergent behavior, as exhibited e.g. by an ant hill. None of the individual ants in an anthill know much, but their collective knowledge enables them to do surprising things. Has no one drawn this comparison? Mcswell (talk) 04:11, 17 January 2014 (UTC)
Quotations for use in editing ...
Here is the material previously under the tag "quote farm" in the article. Perhaps some of this material will be useful in improving the article. I have used the Mill source in the overview, with annotation.
- It must be remembered, besides, that even if a government were superior in intelligence and knowledge to any single individual in the nation, it must be inferior to all the individuals of the nation taken together. It can neither possess in itself, nor enlist in its service, more than a portion of the acquirements and capacities which the country contains, applicable to any given purpose. - John Stuart Mill, Principles of Political Economy with some of their Applications to Social Philosophy
- The problem is thus in no way solved if we can show that all the facts, if they were known to a single mind (as we hypothetically assume them to be given to the observing economist), would uniquely determine the solution; instead we must show how a solution is produced by the interactions of people each of whom possesses only partial knowledge. To assume all the knowledge to be given to a single mind in the same manner in which we assume it to be given to us as the explaining economists is to assume the problem away and to disregard everything that is important and significant in the real world. - Friedrich Hayek[page needed]
- It must be confessed, however, that we seldom know enough to decide in what fields and to what extent the State, on account of the gaps between private and public costs could interfere with individual choice. - Arthur Pigou, Some Aspects of the Welfare State.
- It is a world of change in which we live, and a world of uncertainty. We live only by knowing something about the future; while the problems of life, or of conduct at least, arise from the fact that we know so little. This is as true of business as of other spheres of activity. The essence of the situation is action according to opinion, of greater or less foundation and value, neither entire ignorance nor complete and perfect information, but partial knowledge. - Frank Knight, Risk, Uncertainty, and Profit[page needed]
- Individuals are not, of course, omniscient, even those who think themselves to be. The securing of information about the predicted effects of alternatives is a costly process, even in a world with reasonable certainty. Recognizing this, individual utility-maximizing behavior remains “rational” when choices are made on the basis of less-than-perfect information. There is some “optimal” investment in fact-finding and analysis for the deciding individual at each stage of his deliberation. - James M. Buchanan, Public Finance in Democratic Process
- Development happens thanks to problem-solving systems. To vastly oversimplify for illustrative purposes, the market is a decentralized (private) problem solving system with rich feedback and accountability. Democracy, civil liberties, free speech, protection of rights of dissidents and activists is a decentralized (public) problem solving system with (imperfect) feedback and accountability. Individual liberty in general fosters systems that allow many different individuals to use their particular local knowledge and expertise to attempt many different independent trials at solutions. When you have a large number of independent trials, the probability of solutions goes way up. - William Easterly, The Answer Is 42!
- This process of redistribution of wealth is not prompted by a concatenation of hazards. Those who participate in it are not playing a game of chance, but a game of skill. This process, like all real dynamic processes, reflects the transmission of knowledge from mind to mind. It is possible only because some people have knowledge that others have not yet acquired, because knowledge of change and its implications spread gradually and unevenly throughout society. - Ludwig Lachmann, The Market Economy and the Distribution of Wealth
- One of the strongest arguments in favor of letting people interact freely in a market under property rights institutions is that it is the best known way to utilize the decentralized knowledge of the society— including the knowledge that each individual has about his own values. - David Friedman, The Machinery of Freedom[page needed]
- We know that the essence of markets is that individual cost and value information is private and dispersed, and that command and control economies inevitable must fail to deliver the goods because the appropriate information is not, and cannot be, given to any one mind. - Vernon L. Smith, Commonwealth North Forum
This Marx quote about "true values" is a heavily loaded term - either needs to be fleshed out or deleted. I don't see how the implied immorality of profit exchange is relevant to the topic here of dispersed knowledge in the first place. — Preceding unsigned comment added by Wowsuchoppression (talk • contribs) 05:44, 30 November 2014 (UTC)
- F Hayek (1945). "The Use of Knowledge in Society".