Bryan Caplan  

Yes Donald, Beliefs About Economics Do Affect Policy Preferences

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The last issue of Econ Journal Watch featured my critique of Donald Wittman, followed by his reply to my critique. (For more, see here).

I think the most bizarre part of Wittman's reply is his claim that it doesn't matter what people believe about economics (or anything else), because they wouldn't favor different policies even if they replaced their misconceptions with sound economics:

Unless a person enjoyed acquiring political information, it would be irrational to obtain new information when the new information was unlikely to be strong enough to change the voter’s behavior. I predict that people who greatly overestimate are against foreign aid and would still be against foreign aid even if they were informed of the true value. If this is the case, there is little cost to their being uninformed since they would take the same position (reduce foreign aid) even if correctly informed.

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Voters who are strongly in favor of one candidate are likely to have biased beliefs favoring that candidate, but when such voters are informed of the truth, they are unlikely to prefer the other candidate.

If Wittman means that voters will flatly deny obvious facts that contradict their worldview, I agree. But why do they feel the need to deny the obvious? Because if they admitted the obvious, they would feel the need to change their minds about policy as well.

Have I got any proof? Yes. Here's an excellent example from the Gallup website. (You have to register to access it). In 1996, Gallup asked a random sample of about 800 Americans ONE of the two following questions:

Question 24: Do you favor or oppose raising the minimum wage from four dollars and 25 cents an hour to five dollars and 15 cents an hour?

Question 24 Alternate: Would you favor or oppose raising the minimum wage if it resulted in fewer jobs available to low paid workers in this country?

If Wittman were right, the responses to these two questions would be approximately the same. Survey says:


Favor Oppose Don't Know
Q24 80.60% 17.39% 2.00%
Q24alt 40.41% 57.03% 2.56%

Look at that: Half of the supporters of the minimum wage would defect if they believed that it caused unemployment of low paid workers. The public shifts from overwhelming support to substantial opposition. And you don't need to posit dire consequences like "massive unemployment" to change people's minds. All it takes is "fewer jobs available to low paid workers."

The Gallup survey is especially compelling because most people from both parties passionately support the minimum wage. You might think that support for this feel-good policy would transcend mere facts. But you'd be wrong. (What about the 40 percent who don't switch? Maybe Wittman's right about them, but I suspect that you just need to posit worse negative side effects of the minimum wage).

Unfortunately, this doesn't mean that the public is likely to accept facts that would undermine their support for feel-good policies. But the reason isn't that their policy preferences don't depend on their beliefs about which policies work; the reason is that their beliefs about which policies work are largely determined by their emotions and ideology rather than facts and logic.


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COMMENTS (5 to date)
James writes:

Bryan,

I think you and Wittman may be talking past eachother. Wittman is saying that people won't vote differently after learning some economics because their ideological affiliation keeps them from applying that economic knowledge to their voting decisions. In other words, yes people can learn econ 101, but when they vote, they don't act on it. The difference between your position and his is that you seem to think that the bottleneck is in accepting new ideas. Wittman thinks it's in applying them despite existing affiliations.

As an experiment, one might do a survey similar to the one you cite with the following questions:

Form 1

1. Would you support legislation sponsored by Tom DeLay to increase the minimum wage?

2. Would you support legislation sponsored by Hillary Clinton to increase the minimum wage even if it would create new unemployment?

3. What is your party affiliation?

Form 2

1. Would you support legislation sponsored by Hillary Clinton to increase the minimum wage?

2. Would you support legislation sponsored by Tom DeLay to increase the minimum wage even if it would create new unemployment?

3. What is your party affiliation?

Each participant is given one form or the other on a random basis. This way the experiment tests willingness to change controlling for both economic information and existing affiliation.

Ian Lewis writes:

That Gallup poll was very interesting. Andrew Coulson, an education expert with the Mackinac Center, did a similar poll with school choice. He asked 4 different questions with Vouchers and Tuition Tax-Credits and found very different responses, even though they were all asking (approx.) the same question.

I often find that the biggest difference between Liberals and Conservatives is not the conclusions they have but the questions they ask.

Robert Schwartz writes:

This is why I don't follow poll results. The results are pre-determined by the pollsters. They are all GIGO.

Mikael writes:

If a new brilliant paper comes out, showing why papers reaching opposite conclusions are clearly wrong, stating that income inequality is bad for growth & income distribtuon can increase growth, would you change your political view and vote for extensive income distribution?

Pete writes:

Isn't this point addressed fairly extensively with Kahneman and Tversky's Prospect Theory (a form of a framing effect) and/or summarized in Cialdini's "Influence: The Power of Persuasion"?

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