Saturday, September 22, 2007

Social Proof #2

Jonah Lehrer at the Frontal Cortex mentions Information Cascades, a fancy name for Social Proof:

Information Cascades. Imagine two restaurants that open next door to each other. The first hungry customer doesn't know which restaurant is better, so he flips a coin and hopes for the best. A little bit later, another customer arrives. He also doesn't know which restaurant is better, but he assumes that the restaurant with at least one customer must be better. When the third customer shows up, he sees two people in one restaurant and none in the other, so he also goes to the popular place. The cycle continues in this manner until most customers end up choosing the popular restaurant, even though the other restaurant might serve better food. This is irrational behavior, but it's wired into us. One of the ways we deal with an uncertain situation is to follow the lead of others. We find comfort in numbers.

Economists refer to this process as an "information cascade".

People need to be with other people. The restaurateur’s mission is to facilitate that need.