[Question] How large is the harm from info-cascades? [Info-cascade series]

This is a question in the info-cascade question series. There is a prize pool of up to $800 for answers to these questions. See the link above for full background on the problem (including a bibliography) as well as examples of responses we’d be especially excited to see.

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How can we quantify the impact (harm) of info-cascades?

There are many ways in which info-cascades are harmful. Insofar as people base their decisions on the cascaded info, this can result in bad career choices, mistaken research directions, misallocation of grants, a culture that is easier to hijack by cleverly signalling outsiders (by simply “joining the bubble”), and more.

But in order to properly allocate resources to work on info-cascades we need a better model of how large the effects are, and how they compare with other problems. How can we think about info-cascades from a cost-effectiveness perspective?

We are especially interested in answers to this question that ultimately bear on the effective altruism/​rationality communities, or analyses of other institutions with insights that transfer to these communities.

As an example step in this direction, we built a Guesstimate model, which is described in an answer below.

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