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

by Bryan Caplan

Though it sounds naive to count on the affluent to look out for the interests of the needy, that is roughly what the data advise.

All kinds of voters hope to make society better off, but the well educated are more likely to get the job done.

Selective turnout widens the gap between what the public gets and what it wants. But it narrows the gap between what ...

In financial and betting markets, there are intrinsic reasons why clearer heads wield disproportionate influence.61 People who know more can expect to earn higher profits, giving them a stronger to incentive to participate. Furthermor...

To be blunt, the problem with democracy is not that clearer heads have surplus influence. The problem is that, compared to financial and betting markets, the surplus is small.

If education causes better economic understanding, there is an argument for education subsidies—albeit not necessarily higher subsidies than we have now.62 If the connection is not causal, however, throwing money at education treats a symptom of economic illiteracy, not the disease. You would get more bang for your buck by defunding efforts to “get out the vote.”

One intriguing piece of evidence against the causal theory is that educational attainment rose substantially in the postwar era, but poli...

suppose income growth and job security cause higher economic literacy. Then given a negative economic shock, income growth and job security would decline, reducing the median voter’s economic literacy, increasing the demand for foolish economic policies, which in turn hurts economic performance further. I refer to this downward spiral as “the idea trap.”65 Perhaps it can help solve the central puzzle of development economics: Why poor countries stay poor.

Before studying public opinion, many wonder why democracy does not work better. After one becomes familiar with the public’s systematic biases, however, one is struck by the opposite question: Why does democracy work as well as it does?

How do the unpopular policies that sustain the prosperity of the West survive? Selective participation is probably one significant part of the answer. It is easy to criticize the beliefs of the median voter, b...

What happens if they hold politicians accountable for both their policy decisions and the state of the economy?67 With these incentives, politicians who want to retain power need to keep their eyes on two balls, not one. If voters’ beliefs about effective policy were correct, this would be easy, because the two balls would be fused together. But in the real world, politicians face a visual challenge: keeping their eyes on two balls flying in different directions. If leaders ignore the public’s policy preferences, they will be thrown out of office no matter how good economic conditions are. If they fully implement those preferences, though, leaders become scapegoats for poor economic performance.

This mechanism resembles what political scientists call “retrospective voting.”68 Its novel feature is the perverse trade-off between policies and outcomes. In most retrospective voting models, voters are agnostic about policy, and judge politicians purely for their observable success. Leaders’ dominant strategy is therefore to implement the most effective policies.69 This is no longer true, however, if voters “know what ain’t so”—if they want specific policies but resent their predictable consequences.

If voters are systematically mistaken about what policies work, there is a striking implication: They will not be satisfied by the politicians they elect. A politician who ignores the public’s policy preferences looks like a corrupt tool of special interests. A politician who implements the public’s policy preferences looks incompetent because of the bad consequences. Empirically, the shoe fits: In the GSS, only 25% agree that “people we elect to Congress try to keep the promises they have made during the election,” and only 20% agree that “most government administrators can be trusted to do what is best for the country.”71 Why does democratic competition yield so few satisfied customers? Because politicians are damned if they do and damned if they don’t. The public calls them venal for failing to deliver the impossible.

If jobs have been lost in a recession, something is wrong, but is that the president’s fault? If it is not, then voting on the basis of economic results may be no more rational than killing the pharaoh when the Nile does not flood.

This is especially troublesome under divided government. If the public holds the president accountable for economic turmoil, then Congressmen from the other party might prevent his reelection by doing a bad job.

Alternately, Congress might push popular but counterproductive policies, forcing the president to either veto them (and lose votes for being out of sync with public opinion) or sign them (and lose votes for bad economic performance). Costly but popular social legislation sponsored by the Democrats during the 1988–92 Bush presidency has been interpreted this way.

Despite these caveats, mixed policy/outcome preferences remain a plausible explanation for why democracy is not worse. Respondents in the SAEE have biased beliefs about outcomes, not just policies. Yet their outcome judgments are less biased, and their perceptions about the current state of the economy are fairly accurate.77 Unless the costs of economic policy are well in the future, politicians have to think twice before caving in to popular misconceptions.

Toxicologists are far more likely to emphasize dosage. Nontoxicologists “tend to view chemicals as either safe or dangerous and they appear to equate even small exposures to toxic or carcinogenic chemicals with almost certain harm.”

As in economics, laymen reject the basics, not merely details. Toxicologists are vastly more likely than the public to affirm that “use of chemicals has improved our health more than it has harmed it,” to deny that natural chemicals are less harmful than man-made chemicals, and to reject the view that “it can never be too expensive to reduce the risks associated with chemicals.

This puts a democratic leader in a tight spot. If he embraces the public’s doseless worldview and legislates accordingly, it would spark economic disaster. Over 60% of the public agrees that “it can never be too expensive to reduce the risks associated with chemicals,”85 but the leader who complied would be a hated scapegoat once the economy fell to pieces. On the other hand, a leader who dismisses every low-dose scare as “unscientific” and “paranoid” would soon be a reviled symbol of pedantic insensitivity. Given their incentives, politicians cannot disregard the public’s misconceptions, but they often drag their feet.

The proposition that irrational beliefs lead to foolish policies is largely correct.

The main caveat is that if the public got exactly what it asked for, policy would be a lot worse. The United States is more market-oriented and open to international competition than you would expect after studying the economic beliefs of its inhabitants, whose aspirations seem more in tune with those of Latin American populists like Perón.

Selective participation, so often maligned as a source of class bias, leaves the median voter more economically literate than the median citizen. More importantly, the public’s ungracious tendency to scapegoat its most faithful agents encourages felicitous hypocrisy. Politicians face an uneasy predicament: “Unabashed populism plays well at first, but once the negative consequences hit, voters will blame me, not themselves.” This hardly implies that it never pays to take the populist route. But leaders have to strike a balance between doing what the public thinks works, and what actually does.

The successful politician instinctively feels what the voters feel, regardless of what facts and logic say. His guiding principle is neither efficiency nor equity but electability— about which he knows a good deal.

What happens if fully rational politicians compete for the support of irrational voters—specifically, voters with irrational beliefs about the effects of various policies? It is a recipe for mendacity. If politicians understand the benefits of free trade, but the public is dogmatically protectionist, honest politicians do not get far.

Every serious contender must not only keep his economic understanding to himself, but “pander”—zealously advocate the protectionist views he knows to be false.

Sometimes politicians—unlike ordinary voters—have strong incentives for rationality. Above all, it pays a politician to understand how his policy positions and other actions change his electoral prospects. Politicians have as strong an incentive to think rationally about their popularity as capitalists have to think rationally about their profits.

consider incentives to think rationally about the media. Politicians often have skeletons in their closet, and face daily temptations to add to their collection. Unbiased beliefs about the probability of getting caught and the severity of the backlash are useful tools of political survival. This does not mean that politicians put zero value on illicit fun, but we should expect them to make intelligent trade-offs. Clinton’s relations with “that woman, Miss Lewinsky” ultimately drew massive media attention, but he took many measures along the way to protect himself.

In sum, politicians, unlike average voters, make some political choices where their cost of systematic error is high. In these cases, we should expect leaders to be shrewd and clear-eyed. Selection pressure reinforces this point. Politicians who alienate voters soon cease to be politicians at all.

However, there is one important area where matters are less clear: Beliefs about policy effectiveness. Does it pay politicians to correctly diagnose how well policies work? If all that voters care about is adherence to their policy preferences, the answer is ...

If voters are committed protectionists, politicians do not win their friendship with patient lectures on comparative advantage. Instead of trying to correct popular errors, they indulge them. As Alexander Hamilton put it in The Federalist Papers, they “flatter their prejudices to betray their interests.”

Unusually talented politicians do more than cater to current misconceptions. They steer the grateful public toward the “new and improved” misconceptions of tomorrow. A good politician tells the public what it wants to hear; a better one tells the public what it is going to want to hear.

After a sudden rise in oil prices, the public would probably blame the greed of the oil companies on its own initiative, but lack the imagination to propose price controls. A skillful politician capitalizes on the crisis by alerting his constituents to an...

Leaders’ incentive to rationally assess the effects of policy might be pe...

The honestly mistaken politician appears more genuine because he is more genuine. This gives leaders who sincerely share their constituents’ policy views a competitive advantage over Machiavellian rivals.

To get ahead in politics, leaders need a blend of naive populism and realistic cynicism. No wonder the modal politician has a law degree. Dye and Zeigler report that “70 percent of the presidents, vice presidents, and cabinet officers of the United States and more than 50 percent of the U.S. senators and House members” have been lawyers.14 The economic role of government has greatly expanded since the New Deal, but the percentage of congressmen with economic training remains negligible.15 Economic issues are important to voters, but they do not want politicians with economic expertise—especially not ones who lecture them and point out their confusions.

Instead, the electoral process selects people who are professionally trained to plead cases persuasively and sincerely regardless of their merits.16 Many politicians keep economists around to advise them. But the masters of rhetoric call the shots because they possess the most valuable political skill: Knowing how to strike the optimal balance between being right and being popular.

Many totalitarian movements insist upon their leaders’ infallibility. “The Duce is always right,” was a popular Fascist slogan.18 Rudolf Hess waxed poetic about the perfection of Hitler’s judgment: With pride we see that one man remains beyond all criticism, that is the Führer. This is because everyone feels and knows: he is always right, and he will always be right. The National Socialism of all of us is anchored in uncritical loyalty, in the surrender to the Führer that does not ask for the why in individual cases, in the silent execution of his orders. We believe that the Führer is obeying a higher call to fashion German history. There can be no criticism of this belief.

Mr. Bush has made an important political discovery. Really big misstatements, it turns out, cannot be effectively challenged, because voters can’t believe that a man who seems so likable would do that sort of thing.

Even a colorless politician might find that his title makes his words credible. It works for the pope. Why not the president?

Perhaps the most extreme illustration is the political influence of great poets like Pablo Neruda. Common sense snaps, “What does he know? He’s a poet,” but many would rather listen and be swayed by the beautiful words.

It is arrogant for a leader to snicker that “the people will think what I tell them to think,” but that does not make him wrong.

Faith helps explain politicians’ tendency to dodge pointed questions with vague answers.23 How can refusing to take a position (or changing the subject) be strategically better than candidly endorsing a moderate position?24 Put yourself in the shoes of a voter who opposes the moderate view but has a degree of faith in a candidate’s good intentions. If the candidate announces his allegiance to the moderate view, faith in him dissolves. But as long as the candidate is silent or vague, it does not tax your faith to maintain, “He’s a decent man, he must agree with me.” From politicians’ point of view, the critical fact is that voters on both sides of the issue can “reason” in the same fashion.

Cushioned by the masses’ credulity, an elected official could shirk to their detriment.25 Recall that the simplest way to keep politicians in line is to harshly punish them when you catch them misbehaving. An electorate with faith in its leaders spares the rod and spoils the child.

Still, one should not ignore the upside of political faith: its ability to neutralize the public’s irrationality. A leader who understands the benefits of free trade might ignore the public’s protectionism if he knows that the public will stand behind whatever decision he makes. Since politicians are well educated, and education makes people think more like economists, there is a reason for hope. Blind faith does not create an incentive to choose wisely, but it can eliminate the disincentive to do so. Whether this outweighs the dangers of political faith is an open question.

Princes should let the carrying out of unpopular duties devolve on others, and bestow favors themselves.29 —Niccolò Machiavelli,

In complex modern political systems, leaders can only make a handful of big decisions. The rest must be left in subordinates’ hands. High-level subordinates face the same dilemma, pushing concrete decisions further down the bureaucratic food chain. This fosters the sense that elected leaders are not in charge. The real power, supposedly, is the “faceless bureaucracy.”

In a deep sense, the leader of an organization is responsible for everything his organization does. Mistakes happen, but part of the job is keeping an eye on subordinates. That includes keeping an eye on whether they are keeping an eye on their subordinates. If the grocery bagger at a supermarket is rude to you, it is more than a personal failing. It reflects poorly on the entire chain for failing to detect and correct the bagger’s etiquette.

This argument remains relevant for tenured professors, Supreme Court justices, and others who cannot be fired. When you cannot punish insubordination, rely on reputation instead. Choose candidates with a long history of support for your approach. If a justice undercuts the president who appointed him, a rational electorate can and should blame the president for being a poor judge of character.

The fact that you have some latitude over the cosmetics of a delegated decision hardly shows that you—not your nominal superior—control its substance. The fact that your boss rarely double-checks your work or second-guesses you does not show that he is really working for you. More plausibly, it means that your superior rationally trusts you to make the decision he would have made without being asked.