Prediction Markets: how information flows within an organization

Finally got to reading an article shared by chiao. It's an NYT article titled "Prediction Markets at Google: A Guest Post" by Justin Wolfers.

Essentially, it touches on how information flows within a corporation. The author, in collaboration with Google employees, found that sitting within a few feet of a person tended to facilitate information flow between those persons. Sitting on the same floor as someone barely had an effect. Demographic similarity was unimportant and shared interests helped facilitate information. Interestingly, employees did not necessarily consider people they traded information with as friends. Also, personal relationships tended to persist, even when people were moved away from former bay-mates.

I was struck by this: it almost seemed like a economic justification for laboratory rotations, a process I'm undergoing now. First year PhD students in US colleges generally rotate among 3 different labs a year, spending about 3 months or so in each. Some argue it is a waste of time, as students may not begin their PhD project until their 2nd year. During each rotation, they're exposed to different projects, methods and probably most importantly, they meet different people in the department. Consider it accelerated department interaction. As such, first-years are quickly inducted into the department and build a network for information trading. This can only be beneficial for future work in the department. The organization as a whole works more efficiently.

I'll leave you with a quote from the author - does this reflect your academic environment? :

I don’t know about your firm, but we academics are too self-important to ever sit in cubicles. Our research suggests that this may be unfortunate, and perhaps many of the best ideas in economics never occur, because the idea is waiting for us at a water cooler conversation at which we never arrive. I would love to see my colleagues brainstorm more often and more freely. If we can’t tear down the physical walls between our offices, how can we all change our workplaces to encourage the free flow of information and ideas?