Beyond the Wisdom of the Crowd: How Network Topology Distorts Collective Perception

Abstract

Cognitive biases are often attributed to heuristics or limited information. Yet the structure of social networks is a key, often-overlooked source of perceptual bias. When information passes through social connections, the network alone can systematically distort how individuals view society. We use a simple model in which agents have a binary attribute (e.g., atheist or believer) and show that network topology alone can cause misperceptions of peers' attributes. These misperceptions persist even after aggregation and challenge the idea of the "wisdom of the crowd." We derive an estimator that predicts the size and direction of these biases from network features. We validate our findings using three large-scale opinion surveys. Our results show that network structure is a critical factor in collective perception, with major implications for reducing segregation, polarisation, and the marginalisation of minorities.