Our knowledge reflects the influence of our near neighbours and may give rise to errors. The fact that knowledge flows over short distances helps us to understand the importance of cities in today's knowledge-intensive world. However, the power of local influence also helps us to understand why humans persist in local errors, such as beliefs about poverty or the dangers of different ethnic groups. While human error is typically seen as being at odds with the spirit of modern economics, the tools of economics are actually the best weapons we have for understanding mass mistakes.