The Myth of the Rational Voter: Why Democracies Choose Bad Policies
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The greatest obstacle to sound economic policy is not entrenched special interests or rampant lobbying, but the popular misconceptions, irrational beliefs, and personal biases held by ordinary voters. This is economist Bryan Caplan's sobering assessment in this provocative and eye-opening book. Caplan argues that voters continually elect politicians who either share their biases or else pretend to, resulting in bad policies winning again and again by popular demand.
Boldly calling into question our most basic assumptions about American politics, Caplan contends that democracy fails precisely because it does what voters want. Through an analysis of Americans' voting behavior and opinions on a range of economic issues, he makes the convincing case that noneconomists suffer from four prevailing biases: they underestimate the wisdom of the market mechanism, distrust foreigners, undervalue the benefits of conserving labor, and pessimistically believe the economy is going from bad to worse. Caplan lays out several bold ways to make democratic government work better--for example, urging economic educators to focus on correcting popular misconceptions and recommending that democracies do less and let markets take up the slack.
The Myth of the Rational Voter takes an unflinching look at how people who vote under the influence of false beliefs ultimately end up with government that delivers lousy results. With the upcoming presidential election season drawing nearer, this thought-provoking book is sure to spark a long-overdue reappraisal of our elective system.
Statistics Administration. 2004 . Statistical Abstract of the United States, 2003. Washington, DC: U.S. Department of Commerce. Edgerton, Robert. 1992. Sick Societies: Challenging the Myth of Primitive Har-mony. New York: Free Press. Edlin, Aaron, Andrew Gelman, and Noah Kaplan. Forthcoming. “Voting as a Rational Choice: Why and How People Vote to Improve the Well-Being of Others.” Rationality and Society. URL http://www.stat.columbia.edu/ ~gelman/research/published/rational_final5.pdf.
Other economists counter that standard numbers inadequately adjust for the rising quality and variety of the consumption basket, and the changing composition of the workforce. The rapid growth of the 1990s raised more doubts.104 Either way, the worst-case scenario GDP statistics permit—a lower speed of progress—is no disaster. In the face of popu- lar economic pessimism, Krugman, too, exclaims: “I have seen the present, and it works!”105 The intelligent pessimist’s favorite refuge is to
Throughout the long sweep of history, forecasts of resource scarcity have always been heard, and—just as now—the doomsayers have always claimed that the past was no guide to the future because they stood at a turning point in history. . . . In every period those who would have bet on improvement rather than deterioration in fundamental aspects of material life—such as the availability of natural resources—would usually have been right.109 Simon has been a lightning rod for controversy,
catalogs a long list of other questions where our average guess is systematically mistaken.22 This body of research ought to open our minds to the possibility of systematic voter error. By itself, though, the psychological literature does not get us very far. The link between general cognition and particular political deci- sions is too loose. People could have poor overall judgment but good task-specific judgment.23 Voters might be bad statisticians but percep- tive judges of wise policy.
economist from intervention that ap- peals to noneconomists, and reflect that the latter predominate. You do not have to be dogmatic to take a staunchly promarket position. You just have to notice that the “sophisticated” emphasis on the benefits of intervention mistakes theoretical possibility for empirical likelihood. “ M A R K E T F U N D A M E N T A L I S M ” 197 In the 1970s, the Chicago school became notorious for its “markets good, government bad” outlook. One could interpret my