Reddit and The Wisdom of Crowds
The wisdom of crowds that Surowiecki is talking about consists of the rather counter-intuitive idea that a crowd, given the right circumstances, can be smarter than any of its individuals, however brilliant they might be. I won't reiterate the evidence for the wisdom of crowds Surowiecki has gathered. You have to read his book if you're not convinced of me just saying that.
The right circumstances for crowds to accumulate wisdom boil down to four principles. The first is that the crowd has to be decentralized. As Surowiecki puts it: "people are able to specialize and draw on local knowledge." Second, the choices that the individuals make must be independent of each other: "people's opinions are not determined by the opinions of those around them." The opinions must also be diverse, thus: "each person should have some private information." And finally there must be some mechanism for aggregating the information to a collective decision.
Applying these principles to the way reddit works, I think decentralization, diversity, and aggregation are somewhat given. Reddit's quite decentralized, users are sufficiently diverse (though lack of total diversity might be a bit of problem too), and, well, reddit is an aggregator.
The question becomes, then: are the choices of reddit users independent of each other?
You see, when it comes to the wisdom of crowds, the independence of choices is very important. If choices are not independent, what you get is an "information cascade." It means that the individual persons imitate the choices of others.
A simple example of information cascade: consider two restaurants (call them A and B) near each other and a situation where the both are empty. Let's say they are somewhat similar in quality and not too different otherwise. Then, a person comes to eat and chooces the restaurant A, for whatever reason. And let's say the next person also goes to the restaurant A.
Now, when the next person comes and tries to decide which of restaurants to go to, his decision is likely to be influenced by the fact the B restaurant is empty and the fact there are few people in the restaurant A. Once this process has gone for a while, there's a good chance that no one goes to the restaurant B, because it's empty. People figure out that there must be some reason for people to have chosen the restaurant A over restaurant B. But it might be that the reasons might not have anything to do with preferences of a person trying to decide which restaurant to go to!
Okay, then. Back to reddit.
I have always thought that the way reddit gives "points" based on people's choices is a gross violation of Surowiecki's independence principle. The front page, the "hot" page, shows only links that have at least moderate amount of points, and some people only follow the front page. Thus, their choices are not completely independent. Furthermore, the articles that get a high "score" are more likely to be checked out by people who are not going through all links (ie. most if not all users). Thus, the choice, again, is not completely independent. There's also the psychological (mostly unconscious) effect of following what others do, "herding" you might call it.
Note that I am not saying that reddit absolutely mustn't violate that principle. The violation matters only from the perspective of wisdom of crowds. I think that's important, but you might not.
What I think can cure this is to think of reddit as a personal filter. (Paul Graham himself has been suggesting the idea to the reddit developers. Max Khesin recently realized this too.) The ups and downs ("hot" and "cold") you give to the articles are not giving a general score to the given article, but a hint to the reddit system that you would like to see more similar stuff [1]. So it is somewhat irrelevant to you as a user which articles get the most points, you're only there to use it for your own needs.
But things could be even better. (Even if I used it like that, most of the other users might be suffering from information cascades, thus affecting what I see, too.)
I'd suggest —like Paul did way before me— for reddit to get rid of the visible scoring from the front page and only show how relevant the articles are to you (with some kind of 0-100 point scale or something). If reddit was explicitly and directly a personal filter for every user, I think it would have all the four necessary conditions for fully utilizing the wisdom of crowds. Every user would independently use reddit just for one's own needs, and as a side effect it would be better aggregator collectively.
[1] Whether the way reddit finds similar stuff, through cross-linked scoring, is really effective is another question.