In introducing his blog with Gary Becker, Dick Posner writes:
Blogging is a major new social, political, and economic phenomenon. It is a fresh and striking exemplification of Friedrich Hayek’s thesis that knowledge is widely distributed among people and that the challenge to society is to create mechanisms for pooling that knowledge....The internet enables the instantaneous pooling (and hence correction, refinement, and amplification) of the ideas and opinions, facts and images, reportage and scholarship, generated by bloggers.
My guess is that Judge Posner has not, understandably, spent much time actually reading the blogs that are out there. There is relatively little evidence I have seen of correction and refinement of ideas, facts, and scholarship, and much more amplification and repetition of existing prejudices and ignorance, or, occasionally, feeding frenzies on trivial mistakes in the mainstream media (only in the U.S. blogosphere would you come away thinking that the media in the United States tilts to the left).
The exceptions--that is the bloggers who genuinely refine and advance ideas, facts, and scholarship--are almost entirely bloggers who have pre-blogosphere expertise and competence: the historian Juan Cole, for example. The only virtue of the blogosphere is the same as the general virtue of the Internet: it makes it easier to disseminate genuine expertise and knowledge. But that is rather different from saying the blogosphere provides evidence "that knowledge is widely distributed among people." Ignorance, foolishness, prejudice, parochial bias, irrationality are widely distributed among people (maybe even more widely distributed among those who blog!); knowledge does not appear to be.
Perhaps all Posner has in mind, though, is the phenomenon well-illustrated by the thread on journals, where the experience of many different individuals with the editorial practices of many different journals were collected. In some sense, this represents the refinement and dissemination of facts and information that would have otherwise been harder to collect (everyone would have their random horror story about this or that journal, but when you collect them, you see patterns that otherwise would have been invisible). This, of course, is just an instance of the virtue of the Internet noted above; my guess is Posner had a more ambitious claim in mind.