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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 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.


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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 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.

30 review for The Myth of the Rational Voter: Why Democracies Choose Bad Policies

  1. 4 out of 5

    Courtney

    Since I probably won't finish this book before school starts, I figure I'd put in my review now based on the first few chapters. While I was really excited to see this book come out and feel it's a topic long overdue for a good discussion, I believe Caplan is too smart for his own good. The premise of the book is that if the average person knows more about economics, our democracy would function better. Caplan contends that systematic anti-foreign, anti-market, pessimistic and make-work biases c Since I probably won't finish this book before school starts, I figure I'd put in my review now based on the first few chapters. While I was really excited to see this book come out and feel it's a topic long overdue for a good discussion, I believe Caplan is too smart for his own good. The premise of the book is that if the average person knows more about economics, our democracy would function better. Caplan contends that systematic anti-foreign, anti-market, pessimistic and make-work biases cause voters to elect politicians who espouse policies that are against the voters' best interests. Unfortunately, unlike the captivating and widely-read "Freakonomics" and "Tipping Point," "The Myth of the Rational Voter" is written for the small audience who probably already support his argument. If Caplan really wants to eliminate these biases, he is far better-off dumbing down his writing style (note to author: excessive esoteric references do not buttress your argument, they distract from it) and bringing his argument to the people whose perceptions he would like to change.

  2. 4 out of 5

    Hadrian

    Writing a book that says voters are misinformed and make bad decisions is not as hard a sell as it might have been in 2007. This may have been a book designed to provoke as much as it is to advance an argument. Caplan, an economist at George Mason whose most recent book is on the societal benefits of more immigration, has a bone to pick with some of the older economic explanations of voter behavior. Specifically, he attacks Anthony Downs' book “An Economic Theory of Democracy” and more broadly pu Writing a book that says voters are misinformed and make bad decisions is not as hard a sell as it might have been in 2007. This may have been a book designed to provoke as much as it is to advance an argument. Caplan, an economist at George Mason whose most recent book is on the societal benefits of more immigration, has a bone to pick with some of the older economic explanations of voter behavior. Specifically, he attacks Anthony Downs' book “An Economic Theory of Democracy” and more broadly public choice theory - their position is that there is not enough benefit for voters to learn more about complicated issues that do not apply to them. Caplan does one better - to oversimplify, he has the simple explanation that people vote based on what they believe. What they believe does not always fit labels. When people have incorrect beliefs, they do not experience consequences immediately for having those beliefs, and so they are insulated from their consequences from the vote. It is a simple theory, and it is appealing because of that. Of course, voters can be self-interested or more 'economic' - voting for welfare benefits for themselves or a reduced tax burden, etc. - and Caplan overstates his case for what is only a 'bias' and what is an observation. Manufacturing workers who lost their jobs are understandably more skeptical of free trade, for example. Assuming this isn't only a provocation, Caplan has his suggestions - refraining from encouraging voter turnout, creating limits on what voters can decide and shifting that to representatives or an unelected bureaucracy, shifting more to markets, or encouraging education. I don't know how to address voters making bad decisions besides the last recommendation and that takes time; I personally value democracy because it's a system where the winners and losers don't always try to kill each other after every transfer of power. Could everything here still be taken at face value? I doubt it, but this could be useful as a teaching aid or close reading, where each part of the argument is taken seriously.

  3. 4 out of 5

    Jason Furman

    I was blown away when I read The Myth of the Rational Voter when it came out in 2007. Re-reading it more than a decade later I had much the same feeling. Bryan Caplan argues that voters make systematic errors when they vote about economic issues. The result, he argues, is that expanding voting and the scope of what gets decided by votes results in sub-optimal outcomes. His conclusions are to some degree grounded in a wide literature in politics, economics, social psychology, and other fields but I was blown away when I read The Myth of the Rational Voter when it came out in 2007. Re-reading it more than a decade later I had much the same feeling. Bryan Caplan argues that voters make systematic errors when they vote about economic issues. The result, he argues, is that expanding voting and the scope of what gets decided by votes results in sub-optimal outcomes. His conclusions are to some degree grounded in a wide literature in politics, economics, social psychology, and other fields but to an even greater degree grounded in his rethinking a number of fundamental questions based on first principles. Some of the interest and power of the book lies in some oversimplifications and even distortions of the evidence. But the overall thesis is one that requires us to grapple with—even if I would not take it in the same direction he does of providing new arguments for the same old public choice theory model of skepticism about government. Caplan argues that voters are not self interested or lazy, but vote to make themselves feel better about their core beliefs about what will make the world a better place. So far so good, but the problem is according to Caplan those beliefs about what will make the world a better place are systematically distorted by their misunderstanding of fundamental economics and lack of appreciation for the virtues of competition and free trade. The "not self interested" statement is mostly true. Higher-income voters are less concerned about inequality and less supportive of high taxes on higher-income households, but the difference relative to voters at the middle and the bottom is small compared to the variations within groups. A lot of millionaires want higher taxes on themselves and a lot of plumbers do not want higher taxes on millionaires. Similarly views on abortion and Social Security are much less closely tied to gender and age respectively than one might think. (Caplan overstates his case by arguing that there is no relation to self interest or even an inverse relation in all these cases, that is not borne out by the data.) The social psychology of political views is also mostly true. The high correlation between views on, say, abortion and top tax rates seems like evidence that group identities matter as much as any issue-by-issue assessment of the merits. Democracy for Realists: Why Elections Do Not Produce Responsive Government is a great book that takes on this proposition from another perspective. Where Caplan starts goes from mostly true to sometimes true is his assessment of whether voters' beliefs are rational by comparing people's views to economists views. He also does a "shift-share" analysis by matching up educational and other demographic differences between the groups to adjust what portion of the difference in views is due to "knowledge" vs. personal situation. Where people differ from economists he views the people as irrational and the economist's a reasonable proxy for truth. I teach economics. I teach it because I think we do have better answers by virtue of all of the time we have invested in studying economic questions. And I hope a little exposure will help students update their understanding based on their own investment. So if 90 percent of economists agree on a proposition I think it is probably true. But when economists differ from the public I also try hard to understand if there is something other than public ignorance that might explain it. I am a supporter of free trade but I think much of the opposition is not because people know too little economics but because they correctly understand the economic impact on themselves. Caplan does himself no favors by vastly overstating the negative impacts of certain policies on short-term economic performance. Caplan argues that these irrational beliefs can persist because people pay not cost for having them. People are more rational in markets because the wrong decisions will really hurt them. In politics, the odds of being the decisive voter are effectively zero so any given individual can vote in a way that makes them feel the best without being concerned about the impact because their vote has none. In other words, voters do not take into account the spillovers from their vote. Caplan's vision is not of a political system that is subject to the whims of special interests or an overly powerful elite. Instead it is a political system whose main problems derive from there being too much democracy, and democracy is too responsive to what people think. The problem is not that people are selfish or politicians are ignoring them, instead it is that people act on their beliefs (which actually hurt them) and politicians actually listen to them. Caplan's recommendations are: (1) do not encourage voter turnout because the marginal voter is less "rational"; (2) create limits on what can be decided by democracy; (3) shift more to markets because people have to be more rational there; and (4) have more/better economics education with fewer qualifications and more mostly true statements about the virtues of markets. I am not on board for #1 (maybe because I am one of the irrational democratic fundamentalists Caplan skews with such cold logic), I am sympathetic to maximizing the scope of technocrats (although I don't know if that is what he means by #2), I certainly agree markets need to play an important role but I'm not sure our system badly under appreciates that now but certainly the insight that greed needs to be harnessed to solve problems is an important one economists bring to the table. Finally, I agree on more economics education but think the "caveats" can be true, important and increase the credibility so I strongly disagree with leaving them. More generally, my own view is that people are not systematically biased towards bad ideas (as Caplan argues) or good ones (as naive Democracy fundamentalists think). Instead, the best policy is often uncorrelated with popular opinion. I am suspicious of people who think all their favorite policy ideas are major political winners because it often means either they have conformed their policy views to their reading of the polls or are being terrible political analysts. Personally that lead me to emphasize what I believe the right policies are without making a political argument for them.

  4. 5 out of 5

    Mike Edwards

    Caplan is half right. He explores in some detail why irrationality is inherent to the human condition, and how this necessarily leads voters to make bad decisions. But I have two major problems with the book: 1) Caplan's prime example of how stupid voters are is that voters want to regulate international trade. Certainly free trade is powerful and good, and while I agree with him that protectionist isolation would be very bad, there are reasonable, nuanced, and intelligent reasons that one might Caplan is half right. He explores in some detail why irrationality is inherent to the human condition, and how this necessarily leads voters to make bad decisions. But I have two major problems with the book: 1) Caplan's prime example of how stupid voters are is that voters want to regulate international trade. Certainly free trade is powerful and good, and while I agree with him that protectionist isolation would be very bad, there are reasonable, nuanced, and intelligent reasons that one might oppose any given trade agreement. 2) Caplan concludes that democracy is a failed experiment, without ever providing substantial evidence that any other form of government would work better. He asserts that we should instead move to a "market-based" government, without ever explaining what that is, how it would function, nor how it would overcome the inherent problems of irrationality.

  5. 4 out of 5

    Rinstinkt

    Are voters rational? (Are all humans rational in all aspects of their lives?) Bryan Caplan perfectly illustrates how voters are uninformed, they dont want to be informed, no incentives, and as a consequence they vote and support bad policies. I enjoy his writing style and have been reading his blog since the 2010s.

  6. 4 out of 5

    Mike

    This book is all about economics and the amazing differences in beliefs of trained economists and the voting public. The author posits and offers proof that this is why democracies choose bad policies. The book is not about anything other than economics. If you are interested in other, non-economic, irrational beliefs and how they tie in to politics, you won't find it in this book. This book is all about economics and the amazing differences in beliefs of trained economists and the voting public. The author posits and offers proof that this is why democracies choose bad policies. The book is not about anything other than economics. If you are interested in other, non-economic, irrational beliefs and how they tie in to politics, you won't find it in this book.

  7. 4 out of 5

    Sergei Moska

    There's too much here for me to give it less than 3 stars, but Caplan seems to willfully ignore two (related) retorts to this thesis. Two caveats, though. First, I'm not summarizing the (interesting!) argument, so if you haven't read a synopsis of the book, it's possible that none of this will make sense. Second, I'm not writing this with the thought that it "disproves" Caplan. It's just a couple of things that were bugging me. The first retort is that when he characterizes adherence to politica There's too much here for me to give it less than 3 stars, but Caplan seems to willfully ignore two (related) retorts to this thesis. Two caveats, though. First, I'm not summarizing the (interesting!) argument, so if you haven't read a synopsis of the book, it's possible that none of this will make sense. Second, I'm not writing this with the thought that it "disproves" Caplan. It's just a couple of things that were bugging me. The first retort is that when he characterizes adherence to political points of view as similar in kind to adherence to religion, he confounds religion as (1) an explanation for empirical phenomena and religion as (2) a source of morality. Note that there isn't a necessary connection between the two; there is nothing about believing that the world is 6000 years old that necessitates believing that Jesus Christ is the son of God, for instance. The upshot is that yes, if my political identity is important to me qua (1), Caplan's analysis works. But if it's important to me because of (2), then the analysis needs more nuance. My political ideology may lead me to a (1) that is silly, but it may also be a source of a (2) that is no less sound than competing (2)s. For instance, take the following hypothetical discussion: ------ LAYMAN: I support drastically cutting foreign aid. Doing so would balance the budget and show the rest of the world that there's no such thing as a free lunch! ECONOMIST: Actually, you're wrong. Foreign aid is a tiny fraction of the budget. It would make no difference, and might even be counterproductive LAYMAN: Well, I don't care. No one should expect handouts, even if it's to our benefit to give those bums free money ------ Caplan's argument crucially depends on the notion that systematic bias occurs due us non-economists' lack of incentives to take the costs of our ideology seriously, given our knowledge that our vote will not be decisive. If we knew that our vote *were* decisive, we'd pay attention. But he just seems to ignore the possibility that people's commitment to certain values are such that they're willing to take the hit in terms of material benefit, even if they knew that their vote were decisive. This leads into the second retort: there is no concern whatsoever with distributive justice in this book. I'm not saying that Caplan should defend a model - I'm saying that he ignores the possibility that laypeople are motivated by such concerns. But if you keep the possibility that they *are* so motivated in mind, some of his inferences just seem odd. To take one example: laypeople think that executives' salaries are too high. Caplan thinks that it's because they think that more money to the CEO means less money to the rank-and-file. But surely many people object to CEO salaries because they signal an economic disparity which people find morally repugnant. People may be aware that additional restrictions "shrink the pie", but maybe they're willing to forgo an increased pie if it means that there is more equality. Maybe it's an artifact of economics, but Caplan's proposed preference functions don't seem to take seriously the possibility that the position of others may have a fundamental impact on *my* preference function. Maybe you are so rich that it becomes an affront to my sense of dignity. Maybe I have a communitarian belief that a good polity resembles a "family", and that gross inequality upsets that belief. Call it a religion if you want, but even if an economist convinced such a communitarian of the raw facts, the communitarian may still choose increased democracy and decreased markets. Lastly, it's pretty bizarre that Caplan doesn't seem to deal with these questions, given that in laboratory conditions, most people who play simple economics games like "Divide the dollar" seem to exhibit traits that indicate that self-respect and relative status are important to them. In any event, a fun book, and good enough to prompt me to write a (too) lengthy review :-)

  8. 5 out of 5

    catharine

    I read this book because ever since Prop 8 passed in California, I have completely lost faith in direct democracy, and started feeling like voting was just opting into a corrupt system of the majority suppressing whatever minority they didn't like. The "We are the 99%" protests rubbed me the same way. This book confirmed some of my mood, but left me a bit more hopeful. The author offers an erudite, economist viewpoint that the perception that voting is just like the free market is wrong because I read this book because ever since Prop 8 passed in California, I have completely lost faith in direct democracy, and started feeling like voting was just opting into a corrupt system of the majority suppressing whatever minority they didn't like. The "We are the 99%" protests rubbed me the same way. This book confirmed some of my mood, but left me a bit more hopeful. The author offers an erudite, economist viewpoint that the perception that voting is just like the free market is wrong because the incentives and risks are nothing like market forces. The individual cost of voting is very low, and the individual impact of bad policy is even lower. However the aggregate or community impact of bad policy is terrible. I found the analysis of the "average voter" versus an "educated voter" versus an "economist" on a number of issues from taxes to education to immigration to be very telling, and offer the following summary of my conclusions from this data: 1) People act less selfishly with their votes than a market model predicts. Across all income and education and political affiliations, people vote for policies that they think will make the country better, even when it might not be in their own best interest. 2) People think everyone else is acting more selfishly with their voting then they actually are. This adds a lot of FUD and fear based rhetoric to the political climate that is unjustified. Examples include polls showing that the elderly are less supportive of Medicare than average and men are more pro-choice than women (which I could not corroborate, but I believe the second stat to be one that fluctuates a great deal). 3) If someone bothers to put in a huge investment in researching and voting rationally, it is probably not worth their time. However, if you assume the uneducated voters are voting essentially at random, this means that educated voters have MORE of an impact, especially if they mobilize. At the same time, our best course of action for more rational economic policies is (his conclusion, I'm not sure I agree) is to stop all attempts to "get out the vote" since this results in more uneducated and uniformed people voting. 4) People would rather vote for feel good policies than policies that work because the individual cost of voting their conscience and having a bad policy is less for them than the value of the warm fuzzy (whether that is the good feeling of political affiliation/identity, or the idea that things like protectionism and tariffs "protect american jobs"). 5) The author concludes that democracy is flawed, and that its flaws are overlooked and discounted instead of being mitigated. He believes most people in this country also have an anti-market bias, while criticizing democracy is verboten. He doesn't conclude that democracy should be rejected, but that the flaws in the system need to be acknowledged and mitigated. One of the ways to do this is to increase the average person's understanding of economic theory, preferably at the grade and high school level. It certainly left me thirsty for more economics knowledge. I didn't take ANY economics in any of my educational travelings. Next I want to read his book on child rearing: "Selfish Reasons for Having More Kids"

  9. 4 out of 5

    Joshua

    Taking on both public choice economics and democratic fundamentalists, economist Bryan Caplan brilliantly demonstrates that people's voting habits are riddled with systematic errors (biases) that result in irrational economic policies (e.g., economic nationalism). He grounds his claims on literature from a wide selection of fields, ranging from politics to economics to psychology. His most interesting conclusion is that irrational beliefs and their attendant voting habits persist because people Taking on both public choice economics and democratic fundamentalists, economist Bryan Caplan brilliantly demonstrates that people's voting habits are riddled with systematic errors (biases) that result in irrational economic policies (e.g., economic nationalism). He grounds his claims on literature from a wide selection of fields, ranging from politics to economics to psychology. His most interesting conclusion is that irrational beliefs and their attendant voting habits persist because people do not have to pay the cost for having them. The chances of casting the deciding vote during any election or referendum are minuscule; thus, individuals can vote in a way that makes them feel best (e.g., confirming an anti-foreign bias) without being overly concerned about the impact of their decision. Caplan makes four recommendations to address irrational voting: 1) discourage greater voter turnout (the average voter is more rational than the average abstainer), 2) limit what can be decided on by vote (the U.S. Constitution does this to a limited degree), 3) shift more decisions to the market (people pay for their decisions in that arena and are consequently more rational), and 4) more and higher quality economics education for students (at least teach students about comparative advantage for god's sake!). The Myth of the Rational Voter is a well-researched and engaging read. Even if you don't buy all of Caplan's recommendations, his arguments demand your concentration and make you think.

  10. 5 out of 5

    Carl

    Requiring my concentration throughout, this book packs a big payoff in every section. The author presents the economic biases shared by a frighteningly large majority of voters and follows by clearly (although with a lot of empirical evidence) demystifying these biases in a way that makes your brain feel good. Caplan, a Princeton economist, cleaves the difference between the rational way we conduct business in our economic lives and the irrational way we hold political positions on economic issu Requiring my concentration throughout, this book packs a big payoff in every section. The author presents the economic biases shared by a frighteningly large majority of voters and follows by clearly (although with a lot of empirical evidence) demystifying these biases in a way that makes your brain feel good. Caplan, a Princeton economist, cleaves the difference between the rational way we conduct business in our economic lives and the irrational way we hold political positions on economic issues and blazes the trail to view the electorate as systematically irrational. Think of it as book on philosophy with demand curve graphs or the behavioral psychology of truth seeking, this book is invaluable for anyone who has formally studied economics and subsequently sifted through the data available in the media to stake out a position on truth and justice in this world. There's more to the story than people voting in the perceived economic self-interest. Democracy and markets can't be examined through the same lens. Read on. Best Political Book of the Year -Carl

  11. 5 out of 5

    Max

    Caplan argues that the average voter is often not only uninformed but systematically biased in their judgement. He heavily draws on data of the Survey of Americans and Economists about the Economy, showing that the "enlightened" public, i.e. those that for example can tell the name of their senator, are in general very close to the opinion of economists. (I'm not sure how strong this argument is, I'd have preferred some data on successful predictions made by the class of economists versus laypeo Caplan argues that the average voter is often not only uninformed but systematically biased in their judgement. He heavily draws on data of the Survey of Americans and Economists about the Economy, showing that the "enlightened" public, i.e. those that for example can tell the name of their senator, are in general very close to the opinion of economists. (I'm not sure how strong this argument is, I'd have preferred some data on successful predictions made by the class of economists versus laypeople.) The book is held together by four economy-related biases: 1. anti-market bias (e.g. having a negative attitude towards profit-seeking companies, neglecting the benefits from trade and competition) 2. anti-foreign bias (zero-sum attitude when trading with other nations, e.g. the aversion against trade deficits) 3. make-work bias (aversion against automation and downsizing of companies even though this generally increases overall wealth creation) 4. pessimism bias His policy recommendations are along the lines of "Be happy with a little less democratic influence here and there". This seems reasonable enough and was a good reminder for me, as I grew up with some blind faith in democracy. I still find accusations of the "This procedure is very undemocratic" type emotionally provoking, although I also completely agree that many things are best done with a more or less free market or decided by every person individually. Overall, I enjoyed it. But please, read it with care: This book is highly undemocratic.

  12. 4 out of 5

    Joey

    I am not an "economist," but according to Bryan Caplan, I can be defined as a part of the “enlightened public” because I have a Master’s degree (4.0 GPA in education from UMass Boston). I have also been living under the American poverty line as an American-born citizen for the last three years (not by choice or any lack of effort to obtain a living wage). Caplan is a professor of economics at George Mason University and touts a Ph.D. from Princeton University (also the publisher of this book, wh I am not an "economist," but according to Bryan Caplan, I can be defined as a part of the “enlightened public” because I have a Master’s degree (4.0 GPA in education from UMass Boston). I have also been living under the American poverty line as an American-born citizen for the last three years (not by choice or any lack of effort to obtain a living wage). Caplan is a professor of economics at George Mason University and touts a Ph.D. from Princeton University (also the publisher of this book, which is totally convenient). I believe that Caplan’s 2007 production of The Myth of the Rational Voter: Why Democracies Choose Bad Polices was far more compelling than his 2011 effort, Selfish Reasons to Have More Kids: Why Being a Great Parent is Less Work and More Fun Than You Think, which I only rated one star on Goodreads (he only mentions divorce once in his entire book!). Caplan opens: “One vote has so small a probability of affecting electoral outcomes that a realistic egoist pays no attention to politics; he chooses to be, in economic jargon, rationally ignorant.” (5) I would agree. I made the conscious decision not to vote in the 2016 presidential election, but certainly have at least some practical knowledge and understanding of American politics. Caplan attempts to adjust and bridge the gap between “economists” and the “public” heavily utilizing data from the SAEE (Survey of Americans and Economists on the Economy) by establishing a theoretical “enlightened public.” “As with religion, extreme ideologies lie at the end of a continuum.” (16) Caplan believes that obtaining data on the economic beliefs of economists and the public is “deceptively easy.” (52) He also argues that “There are large belief gaps between economists and the public.” (52) In order to conceptualize a middle ground, Caplan first defines the belief of the “enlightened public” as: “the answer to the question, ‘What would the average person believe if he had a Ph.D. in economics?’ Or equivalently: ‘What would Ph.D. economists believe if their finances and political ideology matched those of the average person?’” (55) “My findings may not be watertight, but they are more than seaworthy.” (79) No shit Sherlock. If Caplan wanted a stronger argument, the Technical Appendix for The Enlightened Public should have been presented BEFORE Figures 3.1-3.37, not almost 40 pages later. In behavioral sciences, definitions of variables AND baselines should be presented BEFORE findings and conclusions (or lack thereof). The most important variable on Caplan’s spectrum that links economists and the “enlightened public” is the answer to the question: “What is the last grade or class that you COMPLETED in school?” (92) By definition, 7.00 on this scale is “Post-graduate training or professional schooling after college (e.g. toward a master’s degree or Ph.D.; law or medical school)” (92) In 2007, a near decade before the 2016 presidential election, Caplan shares these near-prophetic words: “A shrewd businessman I know has long thought that everything wrong in the American economy could be solved with two expedients: 1. A naval blockade of Japan. 2. A Berlin Wall at the Mexican border.” (36) Expedient numero dos is currently shutting down the government in spans of 69 (nice) hours. On February 13, 2018, Caplan is publishing a book titled, The Case Against Education: Why the Education System Is a Waste of Time and Money (also conveniently published by Princeton University Press). The mere title of this book certainly throws a monkey wrench in this sheepish and poorly organized resolve. Caplan laments, “The junior high dystopia never materialized. I am still waiting be offered drugs.” (44) Perhaps Bryan’s buddies at Princeton didn’t have access to any good Bob Hope. Any chance the American government could RATIONALLY federally tax and regulate marijuana like alcohol and tobacco to help grow the American economy before it becomes a SHITHOLE? Just a deceptively easy idea in case anyone still believes in the First Amendment. Donald, are you listening?

  13. 4 out of 5

    Alexander Velasquez

    This book will probably haunt me until the day I die. It will haunt me before I sleep, and it will haunt me when I wake. It is a chilling analysis of why democracy, as we know it in America, does not work. It doesn't work because most people are irrational voters. People are irrational voters because they vote on their preconceived biases about the economy, foreign policy, etc. And their biases are mostly wrong because they're uneducated about these matters, and the educated elites that are educ This book will probably haunt me until the day I die. It will haunt me before I sleep, and it will haunt me when I wake. It is a chilling analysis of why democracy, as we know it in America, does not work. It doesn't work because most people are irrational voters. People are irrational voters because they vote on their preconceived biases about the economy, foreign policy, etc. And their biases are mostly wrong because they're uneducated about these matters, and the educated elites that are educated about these matters almost always disagree with the uneducated majority on these matters. But since it's the uneducated majority who wield most of the power... well you get the idea. Chapter 1 discusses why biased beliefs about economics make democracy worse at what it does. Chapter 2 discusses the four major biases irrational voters fall prey to: antimarket bias (a tendency to underestimate the economic benefits of the market mechanism), antiforeign bias (the tendency to underestimate the economic benefits of interaction with foreigners), make-work bias (the tendency to underestimate the economic benefits of conserving labor), and pessimistic bias (the tendency to overestimate the severity of economic problems and underestimate the (recent) past, present, and future performance of the economy). Chapter 3 goes over the SAEE and the empirical evidence for the claims made in chapter 2. Chapter 4 talks about what is wrong about rational ignorance, and chapter 5 discusses rational irrationality, that is - the rationality behind being irrational about voting (if the information required to be a rational voter takes time to understand, but the outcome for the individual is near nonexistent, why bother with being a rational voter in the first place?). Chapters 6 & 7 discuss how we get to policy and politicians from irrationality. (Hint: The politician must succumb to the masses and what they want - they demand and the politicians supply). Chapter 8 discusses market fundamentalism & democratic fundamentalism. And then the final chapter discusses: now what? If the system is broken, what do we do to fix it? Caplan calls for a further inquiry into the matter, as well as some tips for reform (such as making a law that would require passing a test in order to vote, much like passing a test in order to get a drivers license). A really fun and captivating read. I would highly recommend it to those who wonder why stupid people like Trump can get elected as the Republican nominee. (Hint: It's not Trump who's stupid He's simply the demand ;)).

  14. 5 out of 5

    Alex Zakharov

    Let’s start with the bad news - democracy works! The good news is that luckily for the populace it is marginally subverted by the interest groups and politicians. That’s right kids - the brilliant cover with mesmerized sheep is more charitable to the voters than the brief volume that follows it – at least sheep can accidently stumble upon a good idea... The famous miracle of aggregation that is supposed to cancel out random errors of judgment and thus save democracy from stupid decisions of unin Let’s start with the bad news - democracy works! The good news is that luckily for the populace it is marginally subverted by the interest groups and politicians. That’s right kids - the brilliant cover with mesmerized sheep is more charitable to the voters than the brief volume that follows it – at least sheep can accidently stumble upon a good idea... The famous miracle of aggregation that is supposed to cancel out random errors of judgment and thus save democracy from stupid decisions of uninformed majority by allowing for the disproportionate influence of the minority of the well-informed falls on its face once we realize that general populace has systematic rather than random biases. Caplan concentrates on economic biases (anti market, anti-immigration, “make work” and pessimism) and shows how bad economic policies are passed because of, not in spite of the preferences of average joe. Yes, lobbyists and politicians do sometimes tilt the policy for own benefit but only along the margins of voters’ indifference, for the most part voters get what they deserve and if anything politicians cushion the blow by being forced to balance the overt wishes of the voters and having to answer for the outcomes. It is an incredibly entertaining and well-argued book and it’s worthwhile considering its message whenever the next study revealing the nefarious nature of American oligarchy comes out. Notes to self: - The amount of disagreement among economists is largely exaggerated by the media, there are wide areas of agreement on basic principles (that tend to be unintuitive for general population). Most economists are moderate democrats btw that favor market oriented policies. - Judging policy by intent rather than outcome is bad, confusing outcome with intent is even worse - Voters do NOT vote with their wallets, and do exhibit strong preferences over beliefs because - the larger the populace the less chances of a given vote being a tie-breaker

  15. 4 out of 5

    Mike (the Paladin)

    Alexis de Tocqueville told us in 1835 that “The American Republic will endure until the day Congress discovers that it can bribe the public with the public's money.” That's not an exact quote as I've had pointed out to me but it's what the man wrote almost 200 years ago. Or there's: It can only exist until the majority discovers it can vote itself largess out of the public funds (treasury). Actually to be precise America is not a democracy. We are a Democratic, Constitutional Republic. That said Alexis de Tocqueville told us in 1835 that “The American Republic will endure until the day Congress discovers that it can bribe the public with the public's money.” That's not an exact quote as I've had pointed out to me but it's what the man wrote almost 200 years ago. Or there's: It can only exist until the majority discovers it can vote itself largess out of the public funds (treasury). Actually to be precise America is not a democracy. We are a Democratic, Constitutional Republic. That said much if not all that the author says here still applies. There was another writer in the late 1700s and early 1800s named Alexander Fraser Tytler. He stressed the opinion that no Democracy nor Republic ever lasted long before a single ruler or group took over. This book from mostly and economic point of view gives us many of the same warnings that have been out there from the first. These warnings have been largely forgotten if not buried by willing accomplices so America heads merrily on it's way toward crash and collapse. And I'll bet most of the people who just read that rolled their eyes or something and just decided that I (the reviewer) and the writer of the book are just more Chicken Littles warning about the coming crash. Look up irony...it won't be apparent for a while yet (or hopefully ever if enough listen) but if things go on unchanged it will. I rate this book 3 stars because in spite of it's relative readability and the fact I recommend it the very subject makes the book somewhat dry reading (note I said "relative" readability). So, interesting, accurate...somewhat depressing and recommended.

  16. 5 out of 5

    Chris Lund

    I definitely wasn't convinced of the strength of all the arguments in the book, and by the time I got to the end I felt a bit unsatisfied and unresolved, but it was worth the read if for no other reason than it forces you to confront the issue of bad policy decisions in ways that are rarely talked about, and from an angle that is quite different from the typical discussions of these issues. The writing is a level or two above "casual non-fiction reader", and it probably helps to have a bit of an I definitely wasn't convinced of the strength of all the arguments in the book, and by the time I got to the end I felt a bit unsatisfied and unresolved, but it was worth the read if for no other reason than it forces you to confront the issue of bad policy decisions in ways that are rarely talked about, and from an angle that is quite different from the typical discussions of these issues. The writing is a level or two above "casual non-fiction reader", and it probably helps to have a bit of an economics background on this one, but for the most part its not overly technical and should still be accessible to the average reader. There were more than a few sections that I had to re-read multiple times before they finally clicked, but in the end most of it made sense to, despite my having never taken an economics class in my life.

  17. 5 out of 5

    Howard Olsen

    A good look at the harsh reality of political discourse in a democracy. Not only do people lack the time and information to make truly informed decisions, they also suffer from basic analytical fallacies that are readily exploited by politicians on the make. Don't start feeling smug, though. Caplan takes on sacred cows on the Left (protectionism works! globalization = evil!) and on the Right (immigration is bad! deficits = evil) with equal aplomb. As Caplan notes throughout, many economic fallac A good look at the harsh reality of political discourse in a democracy. Not only do people lack the time and information to make truly informed decisions, they also suffer from basic analytical fallacies that are readily exploited by politicians on the make. Don't start feeling smug, though. Caplan takes on sacred cows on the Left (protectionism works! globalization = evil!) and on the Right (immigration is bad! deficits = evil) with equal aplomb. As Caplan notes throughout, many economic fallacies have persisted for centuries with voters and politicians reinforcing each others worst tendencies. Thought provoking and teeth grinding.

  18. 4 out of 5

    Pete

    The Myth of the Rational Voter : Why Democracies Choose Bad Policies (2007) by Bryan Caplan is an interesting but flawed book that posits interesting models of how people vote and how poorly they understand economics and how this impacts democracies. Caplan is a professor of economics at GMU. Caplan puts forward a fascinating view about voting, namely that people are well aware that their vote doesn’t really matter and so choosing a politician with foolish policies actually costs very little. To The Myth of the Rational Voter : Why Democracies Choose Bad Policies (2007) by Bryan Caplan is an interesting but flawed book that posits interesting models of how people vote and how poorly they understand economics and how this impacts democracies. Caplan is a professor of economics at GMU. Caplan puts forward a fascinating view about voting, namely that people are well aware that their vote doesn’t really matter and so choosing a politician with foolish policies actually costs very little. To give an example, say voting for a politician with a policy that will cost a voter $1000 and everyone else $1000, if the.chance of a particular vote being decisive is 1 in 1000 the expected impact of the foolish policy is only $1 on a person voting for the policy. This is described as a rational description of irrational behaviour. Where as if someone shops foolishly the impact is felt rapidly, but voting foolishly has little expected impact. The book also examines how the general public’s views differ from economists on things that economists would regard as fairly straightforward, such as the value of markets, the failure of price controls and the value of free trade. Unfortunately the book goes into too much painful detail on this. A shorter summary of the results would have been better. Caplan contrasts how economists are often labeled ‘market fundamentalists’ when suggesting that markets work better than most other systems while nobody is labeled a Democracy fundamentalists for suggesting that some of the failures of democracy really just need more democracy. There is a very interesting point made against the hypothesis of the self-interested voter, namely that it doesn’t stand up to empirical scrutiny. Far from all rich people vote for tax cuts for themselves and far too few poor people vote for more redistribution. Instead people vote for what they think is correct. The Myth of the Rational Voter makes a very interesting case. Caplan puts forward a plausible model for rational irrationality on behalf of voters. There is also a lot of interest on the way through the book. However, the book is a difficult read and this lets it down. But, for anyone who ponders how people vote for parties that propose ideas that would seem to be foolish the book provides a good framework for thinking about how this can happen.

  19. 5 out of 5

    Skylar Burris

    The Myth of the Rational voter attempts to explain how democracies continue to enact stupid economic policies that are not in the best economic interests of a majority of people. There are two primary reasons: (1) Most voters are ignorant of economics and (2) Even if they are not ignorant of economics, people sometimes value their ideology more than they value prosperity. (Caplan calls this “quasi religion.”) The book is called The MYTH of the Rational Voter because many have argued that voters The Myth of the Rational voter attempts to explain how democracies continue to enact stupid economic policies that are not in the best economic interests of a majority of people. There are two primary reasons: (1) Most voters are ignorant of economics and (2) Even if they are not ignorant of economics, people sometimes value their ideology more than they value prosperity. (Caplan calls this “quasi religion.”) The book is called The MYTH of the Rational Voter because many have argued that voters cannot possibly be irrational; after all, people do what’s in their best interest, right? Caplan dispels the myth that voters “vote their pocketbooks.” In fact, there is little correlation between party affiliation and income; the elderly are actually slightly less likely to support Social Security and Medicare than the general population, and men are more pro-choice than women. (Although, with this last example he gives, it could easily be argued that men ARE voting their pocketbooks; an abortion costs a lot less than 18 years of child support.) Most voters vote for what they believe is in the best interest of the nation. Whether liberal or conservative, Democratic or Republican, most people sincerely want what is best for their country. Why then do we have competing parties and competing economic policies? One reason, again, is ignorance. A voter may want result X and yet vote AGAINST a policy that is more likely to give him result X and FOR a policy that is less likely to give him result X simply because he doesn’t understand how economics work. It’s difficult enough for economic teachers to persuade even economic students to abandon their misassumptions and incorrect biases, and most voters have never so much as taken a single economics course. Another reason is that voters may value different things and therefore have different ideas about what is in the best interest of the nation. For instance, they may value income equality more than they value greater prosperity for all. (i.e. better person A make $50,000 and person B make $45,000 than person A make $100,000 and person B make $49,000, because then there wouldn’t be so much income disparity.) Even if they do value greater prosperity for the majority, voters may not vote for policies that affect it, simply because they are ignorant of the actual effects of policies. Caplan identifies the primary biases that lead to stupid economic decisions as antimarket bias, antiforiegn bias, make-work bias (i.e. valuing employment more than productivity), and pessimism (i.e. the popular tendency to think the economy is worse than it actually is.) These biases, for instance, lead people to support protectionist policies even when they result in less prosperity for them as individuals and for the nation as a whole. Put like this, it all sounds very simple, straightforward, and dull. Yes, the theory is simple (if not placed in complicated economist-speak), but the details are interesting. It’s fun to learn how politically and economically ignorant the average voter (including, alas, me) is. And it’s also fun to speculate on what U.S. policy WOULD look like if the average voter was better informed. To do this, you use a political IQ tests (with questions like – Who are your senators? Is Russia a part of NATO?) and policy opinion polls and establish controls to see how the most informed voters vote. You can also compare economists’ average answers to economic questions with the general public’s average answers and the “enlightened” (politically informed) public’s answers. Using these models, it can be concluded that a more politically informed electorate would be, with regard to foreign policy, less isolationist (but also “slightly more dovish when it comes to use and maintenance of military power”). With regard to social policy, it would be more “liberal” (more pro-choice, pro-gay rights, anti-prayer in school, etc.). With regard to economic policy, it would be more “conservative” (more pro-free market, less inclined to impose environmental regulations, and more in favor of restraining government spending). In other words, if the electorate were more politically informed, the nation would be more libertarian than it is currently. One objection that might be raised to Caplan’s argument is that not even economists agree on how particular policies affect the economy. The old quip is: “If you laid all the economist in the nation end to end, they still would not reach a conclusion.” But Caplan shows that, for the most part, economists do agree, certainly far more than the general public, and they agree at least on whether a policy is generally beneficial or generally harmful for the economy, with few exceptions. Even the economists for liberal administrations generally advised against liberal fiscal policies, but politicians have incentives to do what is politically popular (for liberals, this might mean immense spending on healthcare, for conservatives, limiting immigration), not necessarily what is economically efficient. Caplan explains how people can be irrational voters and yet be rational consumers. The reason is simple: the cost of irrationality is higher when it comes to consumption than when it comes to voting, because the choices in voting are narrower and the probability of effecting an election with a single vote is virtually nonexistent. “Democracy asks voters to make choices, but gives each only and infinitesimal influence…Shoppers have incentives to be rational. Voters do not.” And, of course, the personal price of altruism is much higher than the political price. Thus, by voting for greater spending, for instance, a person can feel good about his or her generosity, without directly or immediately paying the price, even if such policies will hurt the economy in the end. Thus, his choice is "rationally irrational." As someone with an interest in economics, I found the book interesting, but I’m not sure I’d recommend it to a non-economics major, and that’s unfortunate, because it’s the non-economics major who really needs to be informed on these matters. However, the book is so dry, and so full of charts and tables and graphs, that it’s hard to imagine someone without a great deal of interest in economics wading through it. Instead, I would recommend to the non-economics major Thomas Sowell’s Basic Economics.

  20. 4 out of 5

    Jurij Fedorov

    Very enjoyable and recommendable. Pro: About trade between borders and how voters will want to stop this trade because they don't understand basic economics. Also, he answers the question of the rational consumer. If economics assume that the consumer is rational. Then how come the voter is irrational? Doesn't he pay for a product with his vote? Not really. He pays for the bragging rights and the right to belong to his ingroup. His vote by itself won't make him pay less tax. But telling all his fr Very enjoyable and recommendable. Pro: About trade between borders and how voters will want to stop this trade because they don't understand basic economics. Also, he answers the question of the rational consumer. If economics assume that the consumer is rational. Then how come the voter is irrational? Doesn't he pay for a product with his vote? Not really. He pays for the bragging rights and the right to belong to his ingroup. His vote by itself won't make him pay less tax. But telling all his friends he voted for their favorite candidate will get him a surplus. Con: The language used is really complicated at times. I really don't think he understands all his own points very well. Because mostly he rambles and rambles. Still, I like his informative ramble even though it's not as clear as it should have been. A good book on this topic but not the best one.

  21. 4 out of 5

    Ryan

    An excellent economics/politics/psychology book. Author presents a coherent model for why people can (rationally) vote stupidly — basically, because it makes them feel good. Also extensively analyzes why people in their role as the electorate can have objectively irrational beliefs without hurting themselves too much, and why policies end up less bad than the electorate would otherwise demand.

  22. 5 out of 5

    Alexander

    An interesting behavioral economics view of voting. Caplan goes over how voters are systematically biased to oppose social welfare maximizing economic policy and how the self-interested voter hypothesis is misguided.

  23. 5 out of 5

    Michal Lukáč

    mindblowing.

  24. 5 out of 5

    Ciprian Bujor

    A very good book for those naïves who still have faith in human group intelligence and those who think that the existing voting system is representing the real will of the people

  25. 5 out of 5

    WILLIAM COWHEY

    After reading Caplan's other book on Education, I didn't have high hopes for this one, but even with low expectations I still felt let down. Even though I am staunchly anti-Libertarian, I read this book as an attempt to open my mind to new ideas and because I enjoyed the data presented in Caplan's other book (even if I disagreed with the conclusions he drew from it). However, this book was a mess. The writing style is not engaging, Caplan repeats himself again and again, and so much in it is jus After reading Caplan's other book on Education, I didn't have high hopes for this one, but even with low expectations I still felt let down. Even though I am staunchly anti-Libertarian, I read this book as an attempt to open my mind to new ideas and because I enjoyed the data presented in Caplan's other book (even if I disagreed with the conclusions he drew from it). However, this book was a mess. The writing style is not engaging, Caplan repeats himself again and again, and so much in it is just plain wrong. I have to give him a little slack for the year it was written and what has happened since, but there's no excuse for the insufferably arrogant and condescending tone of the book, which made it a chore to get through. The main premise of the book is that democracy is a bad idea because people are irrational when it comes to voting. The assumption is that while people are rational consumers due to material interest, the incentives for voting promote irrational behavior, because it's highly unlikely that a person's singular vote will swing an election, therefore the cost for having harmful beliefs is low. While there is definite truth to some voter irrationality (just look at the last four years in the US for a prime example), Caplan makes some bizarre assumptions about democracy without providing any evidence for them besides some questionable thought experiments. First, he says that democracy doesn't precisely because the will of average voter is actually done and the average voter wishes for harmful policies. Caplan also makes the astonishing claim that politicians don't make false promises because they'll be punished for not following through. He acknowledges the presence of special interests, but claims they only have impact on the margins because sticking up for any unpopular policies is too big of a career risk (I actually laughed out loud when I got to this part). Futhermore, he says that propaganda isn't a problem worth worrying about because people are already prone to be skeptical of the news, and that their core "wrong" beliefs existed before big media because of a "natural" disposition to them. This alone almost discredits the entire book because it's so obviously and hilariously wrong. https://scholar.princeton.edu/sites/d... This study looked at 20 years of data, and found that "When the preferences of economic elites and the stands of organized interest groups are controlled for, the preferences of the average American appear to have only a minuscule, near-zero, statistically non-significant impact upon public policy." Any given policy regardless of public support has about a 30% chance of being passed, but when it comes to the elite, that percent jumps up to over 60%. This should sound like good news to Caplan though, because in the book he actively promotes the idea of an oligarchy being the optimal way of governance. Later in the book he argues against the idea that voter suppression is bad, and supports the position that people with more "economic knowledge" (which just so happen to be rich, educated men) should have more votes. He openly pines for the relative lack of government before the 1930s and seriously suggests that maybe the reader should be open to the idea that it was better for everyone without even mentioning the Great Depression it inevitably led to. The amusing irony that this book was written on the precipice of another Great Recession is not lost on me either. Going back to the main premise of the book, Caplan argues that markets are rational and so should have ruling power instead of the public. However, many of the points he tries to make in support of this are dubious at best. For example: - Caplan makes the declaration several times that minimum wage laws are bad because they increase unemployment. I found this to be a bit ironic, as he spend most of the book presenting "empirical evidence" that proves the irrationality of voters, while ignoring that the empirical evidence does not reject the minimum wage. Studies are mixed, but there's plenty of evidence that minimum wage laws increase economic activity by giving the poorest more money to spend and ultimately have a positive impact on employment. - The author says that focus on obscene profits and income inequality is misguided, because high salaries for CEOs encourages them to do socially good things such as "create new products and lower costs". He says many times that what's good for rich people is also good for the poor. Even by 2006 it should have been abundantly clear to Caplan that trickle down economics is a lie, and saying that income inequality doesn't matter reeks of naivete. Historically the kind of income inequality that we are now seeing in the US has only been a portent of worse things to come. - Fights against the idea that usury is bad, because loans and interest are a "quid pro quo" agreement between the lender and borrower that is mutually beneficial. Caplan rejects the idea that there is widespread "dishonsty, unfairness and deceit" among business elites because of "intelligent greed". His theory is that any foul play will ultimately ruin the reputation of a firm and therefore is not worth the risk or is rooted out by consumers going elsewhere. He uses this same logic with usury. I guess payday loans and crippling IMF loans don't exist! Once again I am fascinated by the refusal of Libertarians to acknowledge the existence of exploitation (Caplan does mention Marx's thoughts on labor exploitation, but only as a "look at how obviously ridiculous this is!" and doesn't elaborate any further on any criticisms). - Apparently it's a "conspiracy" to believe that employers try to hold down wages. - Caplan implied that monopolies aren't widespread, despite virtually every industry now being dominated by a handful of firms. And despite the common Libertarian objection, this can't blamed on the government, as it's happened mostly after the deregulation spree that started in the 80s. - Repeats ad nausem that human nature is "selfish". I know this is a very common belief among most people, but any deeper study into human history shows at least as much evidence for "natural" cooperation, so any narrow appeals to human nature have always struck me as little more than pushing an agenda for a specific worldview. - Caplan doesn't even mention climate change and makes the claim that the free market is better equiped to solve environmental problems. He simply makes an indirect reference to it that several environmental scares of the past such as resource depletion or overpopulation have turned out to be overblown, therefore implying that there's likely little to worry about with climate change. He says that things are always getting better, so betting on the future getting better is the rational choice. This is awfully convenient, because he gives Capitalism 100% of the credit for the rising living standards in the past couple hundred of years. Caplan has to ignore climate change, because otherwise he'd have to accept that increased living standards have come at a cost of our future. I also reject his premise. The rise in living standards has mostly been due to industrialization, which hasn't been unique to capitalism, as non-capitalist countries that have industrialized also saw a significant rise in living standards. Futhermore, many of the benefits that have contributed to the rise in living standards such as weekends, the 8-hour work day, and increased social equality for women and minorities were bitterly fought for by mass movements that faced fierce opposition from capitalists every step of the way. Giving the private "free market" full credit doesn't make much sense either, as many of the products that we enjoy now wouldn't have been possible without significant government funding. That's not to say that Capitalism hasn't brought any benefits (even Marx recognized this), but to say that progress in this system is always inevitable in the face of stagnating wages, spiraling costs in basic necessities such as housing, education and healthcare, and a rapidly deteriorating environment seems more like willful ignorance to me. - A final point I take contention with is the rationality of the consumer. Caplan makes the argument that when it comes to things in our everyday lives people are rational due to material interests, whether it's in the short-term or the long-term. But humans are notoriously bad at thinking in the long-term and evidence of the irrationality of consumers is abundant. Gyms wouldn't be able to function without hordes of irrationally optimistic customers paying monthly dues despite rarely or never working out. Credit card companies feast on people who opt to pay the minimum despite it costing them much more in the long run. Products priced at $0.99 instead of nice round numbers trick customers into paying more. If consumers were rational, the vast majority of warranties and lottery tickets would never be bought, and casino gambling would be nearly non-existent. Speaking as someone who works in the field, advertising and marketing are less about informing consumers of an existing product to satisfy a relevant need than subtly manipulating (often emotionally) consumers by artifically creating a desire. Just because someone is able to convince someone else to buy something, that does not mean it is a social good. I realize this has gotten really long, but while Democracy definitely has its issues and alternatives should be discussed, a return to the Gilded Age is certainly not the right path.

  26. 4 out of 5

    Nate

    Caplan's general argument is that a majority of voters in democracies (or representative republics) are rationally irrational when it comes to politics. Since the likelihood of one voter's vote being decisive in an election is practically nil, the costs for being wrong (i.e., choosing a candidate whose policies are bad for the nation) are practically nil to the individual voter. This being the case, voters have little incentive to take the time to become informed on political/economic matters. O Caplan's general argument is that a majority of voters in democracies (or representative republics) are rationally irrational when it comes to politics. Since the likelihood of one voter's vote being decisive in an election is practically nil, the costs for being wrong (i.e., choosing a candidate whose policies are bad for the nation) are practically nil to the individual voter. This being the case, voters have little incentive to take the time to become informed on political/economic matters. On the contrary, there is a disincentive to becoming informed: it costs (e.g., time). Furthermore, there are certain psychological benefits (e.g., feeling like one is acting altruistically) that come from supporting certain policies because supporting them seems like the "fair" and "moral" thing to do. However, psychological benefits and social benefits are not the same thing: Lenin likely thought he was doing the "moral" thing by instituting a Communist government in Russia in 1917-18, but the effects of that form of governance on the people/nation were extremely bad and immoral. An example might help illustrate the argument. It is pretty much undisputed in the economics profession (at least the author states) that free trade among nations is beneficial for both nations: it raises productivity and standards of living in both nations. However, many feel the U.S. should have policies limiting free trade in order to protect American workers in certain industries from the competition of cheaper foreign labor and products. Holding such a position is fine, but the point is that by doing so a voter is effectively lowering his standard of living because he is paying more for goods in protected industries that he would pay if there were no limitations on trade, and the labor in such industries is not being put to its most efficient use possible. But since the individual voter's vote most likely won't decide the election, and since he knows this, he doesn't really see the costs of his voting for policies that would lower his standard of living because he assumes that whatever is going to happen will happen no matter how he votes. Voting to lower one's standard of living seems irrational. But since one's vote has very little impact on an election it is rational to be irrational. Whether you agree with the author or not, he makes some good points throughout the book that anyone interested in the functioning of democracies would do well to consider.

  27. 4 out of 5

    Stone

    My takeaway and derived thoughts from this book: 1) Industrialized public education is largely useless and should be, at best, abolished. Educating the general populace with economic principles and political norms won't stop them from voting for nonsensical policies that go directly against what they've been taught. The level of stupidity always rises dramatically when people get together to form a crowd, no matter how well-educated the individuals might be. 2) Liberal democracies are not so diffe My takeaway and derived thoughts from this book: 1) Industrialized public education is largely useless and should be, at best, abolished. Educating the general populace with economic principles and political norms won't stop them from voting for nonsensical policies that go directly against what they've been taught. The level of stupidity always rises dramatically when people get together to form a crowd, no matter how well-educated the individuals might be. 2) Liberal democracies are not so different from American Idol for common voters, and because of that, winning the White House is now much easier than climbing up the hierarchy of a Fortune 500 company. Too bad I wasn't born in the United States or I might seriously consider giving it a try -- my look is certainly above the average, medium stature, nice voice, and a sensitive sense of humor, all good for becoming a president. 3) Class division used to be a big topic in the past two centuries, and it will continue to be significant, although in a different way -- classes will be divided not according to social status but according to cognitive competence. I predict there will soon be a class of people who would become virtually useless in all fields, and the best the society can do is to put a nipple in their mouth and let them get high on themselves. Luckily entertainment has become developed enough that it is actively searching for thirsty consumers. Fukuyama's dream of democracy was already destroyed, yet nowadays we still have plenty of people who continue to stand blindly behind this failing system of inefficiency and incompetence. I cannot say for sure what kind of political system we will be having in the future, but I can almost guarantee for sure that it won't be the democracy we currently boast about.

  28. 4 out of 5

    Otto Lehto

    Caplan's catchy diatribe is a fascinating contribution to public debate. I like the no-nonsense style of writing, the polemical bite of the pen and the combination of empirical evidence (about what the public vs. experts vs. educated voters believe) with rational analysis of what they "should" believe. The analysis is full of problems, however, on the following counts: 1) the narrow focus on economics as the main focus of political choice, 2) the underestimation of the personal payoffs of econom Caplan's catchy diatribe is a fascinating contribution to public debate. I like the no-nonsense style of writing, the polemical bite of the pen and the combination of empirical evidence (about what the public vs. experts vs. educated voters believe) with rational analysis of what they "should" believe. The analysis is full of problems, however, on the following counts: 1) the narrow focus on economics as the main focus of political choice, 2) the underestimation of the personal payoffs of economic and political literacy (and thus of the rationality of getting educated in those areas), 3) the failure to see that many swing votes make the personal payoff of a single vote much greater than a random chance, 4) the overestimation of the capacity of economics to give uncontested and univocal policy advice, 5) the equivocation between rational expectations theory and "truly" irrational psychological insight: the theory of "rational irrationality" attempts to marry the best of both worlds, but arguably only offers a modified Chicago school, Gary Becker type explanation of something that is full of "true" irrationality and not just "calculated" irrationality, & 6) the blind faith in the power of experts, according to which "if only economists ran the world..." Overall, I did enjoy the book, and there is nothing mediocre about it, despite the 3-star rating. It pushes hard in one direction - against "democratic fundamentalism" - and does it admirably; but it doesn't always offer the best theory or the best evidence to justify the forcefulness of its push.

  29. 5 out of 5

    Nathaniel

    If you started reading this book but have decided to quit, I heartily encourage you to skip ahead and at least read chapter 5, wherein Caplan's thesis of rational irrationality is given full treatment. Chapters 1 and 2 are very good too, but chapter 5 alone makes this a near-5-star read for me. Chances are that you already read 1-2 but got bogged down somewhere in 3-4: this, anyway, was my experience. Chapter 3 puts a lot of stock in differences between economists and members of the general publi If you started reading this book but have decided to quit, I heartily encourage you to skip ahead and at least read chapter 5, wherein Caplan's thesis of rational irrationality is given full treatment. Chapters 1 and 2 are very good too, but chapter 5 alone makes this a near-5-star read for me. Chances are that you already read 1-2 but got bogged down somewhere in 3-4: this, anyway, was my experience. Chapter 3 puts a lot of stock in differences between economists and members of the general public in their responses to a survey about economics issues. The upshot: economists' consensus differs from public opinion in ways consistent with the four handpicked biases discussed in chapter 2 (anti-market, anti-foreign, make-work, and pessimism biases). As a lay reader with little economics training, I would have liked to see more direct evidence (e.g., in the form of historical examples with outcomes at minimum, and well-designed field experiments at best) that each of these biases actually leads to bad economic outcomes on balance. Chapter 4 spills a lot of ink combating competing theories that presuppose that voters are rational (perhaps it is ignorance, rather than irrationality). This was certainly necessary, but it seemed to drag a bit in places. Lots of interesting stuff here, but for non-economists (who lack assumptions about human rationality and other baggage) it was definitely peripheral to the main argument. Chapter 5 is the climax of the story. The central idea is that voting does not work like a market because voters do not feel the consequences of their decision directly: a single vote is not going to tip the balance (the probability of your vote making the difference and causing bad policies is effectively zero) so they can vote in whatever crazy way makes them feel good without taking on responsibility for the outcome. The contingency between the act of voting for person A and the outcome of person A's policy is a remote one. This policy may be very bad for society, but your vote didn't really matter anyway: The social cost of irrationality is high, but the private cost of irrationality is low. Thus, voters do not have incentives to be rational when voting for politicians or endorsing policies when irrationality in these areas leads to greater psychological rewards. Because the material cost of voting against your economic best interests is so low, while the psychological benefit of voting against your best interests is high (e.g., your xenophobia leads you to favor anti-immigrant policies or tariffs that curtail free trade), people can maintain their cherished (irrational) beliefs with impunity (since the material costs are so low). If everyone who voted for such a policies had to take a steep pay cut to offset the negative economic consequences of these policies, for example, they would be appropriately punished for their irrationality (and demand less irrationality because the price is too high) but this doesn't happen. This is illustrated very simply and effectively with the demand curves for irrationality (e.g., figure 5.2). Again, I am an economics dilettante with little formal training in these issues so this review should be judged accordingly. That being said, I wanted to spend the rest of this review hashing out a couple of intriguing ideas that occurred to me while reading this book. First, a few premises. Progress is good. People are much better of now than they were before in almost every way. And they are getting better. The standard of living is improving, such that people have more comfort by technological advances and/or greater social support. OK, so imagine things keep on like this and we become a world of almost guaranteed comfort (e.g., take for granted things like universal basic income). In such a world, policy decisions become (or at least seem to become) less and less important, because the standard of living is so high than the material consequences of bad policy decisions are no longer felt (or felt to a lesser degree than they currently are). In this scenario, people are punished even less for their irrationality and can thus support whatever identity-flattering policies they choose with relative impunity, however irrational. Is this already happening? Can it account for the rise of identity politics in recent decades? Can it account for the growing divide between Republicans and Democrats? Both main party platforms have their share of irrational planks. Democrats have anti-market bias; Republicans have anti-foreign bias. Both parties are prey to make-work bias, while Conservatives are more greatly affected by pessimism bias. Thus, on balance, conservatives are more irrational (this squares with intuition), but it really doesn't matter because the better off society is, the less it feels the consequences of irrational decision-making and the more the act of voting will be an expressive one, a signal of loyalty to the home team rather than an objective answer to a policy question. OK, so that was my first speculation. My second speculation is a bit more in the weeds and deals with an interesting observation from educational psychology (my field). There is a phenomenon known as the "undermining" or "overjustification" effect where extrinsic rewards undermine intrinsic motivation. It was first observed by Lepper et al. in the 1970s (link to original paper below) and appears to be pretty robust. Basically, the researchers found that if you take an activity someone is spontaneously pursuing during their leisure time (intrinsic motivation) and you tell them they will get a reward for doing that activity (external reward), those receiving the reward will show less intrinsic interest in the activity in the future. Making something impractical (drawing a picture) a practical issue (earning something) requires more intellectual effort and accuracy. The external incentives should increase good performance, but the activity also now less enjoyable than it was before the incentive, so students were less likely to do that activity in the future. Is it irrational to stop pursuing the activity in light of the extrinsic reward? https://www.researchgate.net/profile/...)

  30. 5 out of 5

    Thiago Marzagão

    It's amusing that this book has been denounced as product of economic fundamentalism. Caplan is denouncing the very assumption of rationality that underpins so much of economic theory - which is pretty heterodox of him. And he's making the discussion accessible to general public, which is what one would expect political scientists to have done long ago. But political scientists have generally endorsed the idea of "one person, one vote" because they see it as more conducive to redistributive/welf It's amusing that this book has been denounced as product of economic fundamentalism. Caplan is denouncing the very assumption of rationality that underpins so much of economic theory - which is pretty heterodox of him. And he's making the discussion accessible to general public, which is what one would expect political scientists to have done long ago. But political scientists have generally endorsed the idea of "one person, one vote" because they see it as more conducive to redistributive/welfare policies. Hence for the most part political scientists have confined their discussions of voter behavior to academic papers that journalists (or median voters; or entrepreneurial politicians) are unlikely to read. It took a Bryan Caplan to familiarize the general public with the notion of rational ignorance and to fully explore its most important implication, i.e., that perhaps we should consider restricting the franchise. That probably sounded like lunacy when the book first came out, back in 2007, but my guess is that now, after Trump's election, even political scientists might be a bit more open to the idea.

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