A recent report on the Reserve Bank of Australia highlighted the dangers of ‘group think’ in setting interest rates. It was suggested that when the Governor makes a recommendation to the board – the natural inclination is to accept it. A consensus is reached without in-depth critical reasoning. In his book Collective Illusions, Todd Rose examined the […]

A recent report on the Reserve Bank of Australia highlighted the dangers of ‘group think’ in setting interest rates. It was suggested that when the Governor makes a recommendation to the board – the natural inclination is to accept it. A consensus is reached without in-depth critical reasoning. In his book Collective Illusions, Todd Rose examined the drivers of groupthink. Collective illusions occur when most people express a view the group expresses because they believe most people in the group hold that view. Rose describes this as a ‘funhouse of mirrors’ where the majority think that the majority think something the majority don’t think. Collective illusions can occur due to conformity, information filtering, cognitive bias, or a lack of critical thinking. Collective illusion is not new. What is relatively new is the availability of social media to facilitate it. Rose notes that some 80% of content on social media is generated by about 10% of the users…