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The Myth of the Rational Voter

The Myth of the Rational Voter: Why Democracies Choose
The Myth of the Rational
Bad Policies is a 2007 book by Bryan Caplan, in which the author
Voter
challenges the idea that voters are reasonable people that society can
trust to make laws. Rather, Caplan contends that voters are irrational in
the political sphere and have systematically biased ideas concerning
economics.

Contents
Summary
Make-work bias
Anti-foreign bias
Pessimistic bias
Anti-market bias

Survey of Americans and Economists on the Economy

Rational irrationality
Relation to public choice theory
Cover of the first edition
Reception
Popular press Author Bryan Caplan
Academic press Country United States
Related books Language English
Books published earlier Subject Democracy
Books published later
Publisher Princeton University
See also Press
References Publication 2007
date
Media type Print (Hardback)
Summary Pages 276 (2007 edition)
Throughout the book, Caplan focuses on voters' opinion of economics ISBN 978-0-691-12942-6
since so many political decisions revolve around economic issues (2007 edition, hbk)
(immigration, trade, welfare, economic growth, and so forth). Using data OCLC 71581737
from the Survey of Americans and Economists on the Economy (SAEE), (https://www.worldcat.org
Caplan categorizes the roots of economic errors into four biases: make- /oclc/71581737)
work, anti-foreign, pessimistic, and anti-market.
Dewey 320.6 22
Decimal

Make-work bias LC Class HD87 .C36 2007

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Caplan refers to the make-work bias as a "tendency to underestimate the economic benefits from conserving labor."
[1]:40 Caplan claims that there is a tendency to equate economic growth with job creation. However, that is not
necessarily true, since real economic growth is a product of increases in the productivity of labor. Dislocation and
unemployment can be caused by productivity gains making certain jobs no longer necessary. All things being equal,
economic rationality would require that these people make use of their talents elsewhere. Caplan makes special
emphasis of the movement away from farming over the past 200 years, from nearly 95% of Americans as farmers in
1800 to just 3% in 1999, as an illustrative example.[2] As an economy industrialises, increased labor productivity in
agriculture means less labor is needed to produce a given quantity of agricultural goods, freeing up labour (a scarce
resource) to be employed in the production of manufactured goods and services.

Anti-foreign bias
Caplan refers to the anti-foreign bias as a "tendency to underestimate the economic benefits of interaction with
foreigners."[1]:36 People systematically see their country of origin as in competition with other nations and so oppose
free trade with them. Foreigners are seen as the "enemy" even if the two governments are at a lasting peace. The
principles of comparative advantage allow two countries to benefit a great deal from trade. The degree of benefit is
rarely equalized, but it is always positive for both parties. Caplan notes how the anti-foreign bias can be rooted in
pseudo-racist attitudes. For Americans, trading with Japan and Mexico is more controversial than trading with Canada
and England, the latter of which mostly speaks our language and looks like white Americans.[1]:39

Pessimistic bias
Caplan refers to the pessimistic bias as a "tendency to overestimate the severity of economic problems and
underestimate the (recent) past, present, and future performance of the economy."[1]:44 The public generally perceives
economic conditions as declining. Caplan alleges that there is often little or no evidence to back up such perceptions.
Among challengers Caplan cites is Julian Lincoln Simon and his book, The Ultimate Resource, which argues society
continues to progress despite claims of environmental degradation and an increasing use of natural resources.

Anti-market bias
Caplan refers to the anti-market bias as a "tendency to underestimate the benefits of the market mechanism."[1]:30 In
Caplan's view, the populace tends to view themselves as victims of the market, rather than participants of it.
Corporations, even small-scale suppliers, are seen as greedy monopolists that prey on the consumer. Caplan argues
that all trade is a two-way street. Cheating people is bad for business and the existence of multiple firms offering
similar products demonstrates there is competition, not monopoly power.

Survey of Americans and Economists on the Economy

The author pays special attention to the 1996 Survey of Americans and Economists on the Economy (SAEE), created by
the Washington Post, the Kaiser Family Foundation, and Harvard University Survey Project. The SAEE asked 1,510
random members of the American public and 250 people with PhDs in economics the same questions concerning the
economy. In addition to its 37 topical questions, the SAEE also inquired about the participant's income, income
growth, education, and other demographic information.

The answers to the questions are often different: the public often blames technology, outsourcing, high corporate

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profits, and downsizing as reasons for why growth is lower than it could be. Economists, on the other hand, barely pay
any heed to such arguments. Some 74% of the public blame greedy oil companies for high gas prices, but only 11% of
economists do.[1]:87 The public tends to believe real incomes are decreasing while economists take the opposite stance.

Caplan notes that the chasm between economists and the general public might arguably be due to bias on the expert's
part. Self-serving bias (economists are rich and so they believe whatever benefits them) and ideological assumptions
(economists are a bunch of right-wing ideologues) are two challenges the author addresses. Caplan writes: "Both the
self-serving bias and the ideological bias are, in principle, empirically testable. Economists' views are the product of
their affluence? Then rich economists and rich noneconomists should agree. Economists are blinded by conservative
ideology? Then conservative economists and conservative noneconomists should agree."[1]:54 In turn, if self-serving
bias is unavoidable, it would likewise skew the perceptions of the non-wealthy, causing them to believe both the
"'ought' claim" that government should reduce inequality of wealth and the "'is' claims" that existing inequalities of
outcome are severe and are perpetuated by corporate and governmental power structures.

Using data from the SAEE (which includes measures for ideology, income, job security, and other measures), Caplan
simulates what people would believe if they had the same circumstances as economists, a technique often used in
political science called "enlightened preferences". If the ideological and self-serving biases are true, most of the
difference between the "enlightened public" and economists should disappear. If, however, the enlightened public is
not much closer to economists, then something else is going on, as those explanations have been neutralized. Caplan
believes that that something else is the biases he enumerated earlier. The data tends to support Caplan's argument,
with most (but not all) of the enlightened public closer to economists than to the public.

Rational irrationality
In standard neoclassical economics, people are assumed to be rational; the notion of systematic bias is considered to be
a sloppy assumption. In many ways, Caplan agrees: most people are rational when it comes to choosing a job, buying
milk, hiring employees, and selecting a business strategy. They can be wrong, of course, but a systematic bias rarely, if
ever, occurs.

But the author argues they are rational only because it is costly to be wrong. A racist will still hire a qualified black
person because going to the second-best option will be expensive to the company. A protectionist will still outsource
because he has to achieve as many advantages over his competitors as he can to stay in business. Someone who thinks
a discount store is haunted will seriously question their conclusions when they find their budget to be tight.

Sometimes, however, it is virtually costless for the individual person to hold on to their preconceived beliefs, and
people enjoy such beliefs. Rational irrationality simply states that when it is cheap to believe something (even when it
is wrong) it is rational to believe it. They refuse to retrace their logic and seriously ask themselves if what they believe is
true. For some people, thinking hurts and so they avoid it if they can. This often appears in politics. Caplan argues that,
"Since delusional political beliefs are free, the voter consumes until he reaches his 'satiation point,' believing whatever
makes him feel best. When a person puts on his voting hat, he does not have to give up practical efficacy in exchange
for self-image because he has no practical efficacy to give up in the first place."[1]:132

Relation to public choice theory

The book is notable in use of irrationality, a rare assumption in economics. Yet the work is also a challenge to
conventional public choice, where voters are seen as rationally ignorant. Conventional public choice either emphasizes

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the efficiency of democracy (as in the case of Donald Wittman) or, more commonly, democratic failure because of the
interaction between self-interested politicians or bureaucrats, well-organized, rent-seeking special interests and a
largely indifferent general public (as in the work of Gordon Tullock, James M. Buchanan, and many others).

Caplan, however, emphasizes that democratic failure exists and places the blame for it squarely on the general public.
He makes special emphasis that politicians are often caught between a rock and a hard place: thanks to advisors, they
know what policies would be generally beneficial, but they also know that those policies are not what people want.
Thus, they are balancing good economic policy, so they do not get voted out of office because of slow growth, and bad
economic policy, so they do not get voted out of office because of unpopular policies.

Reception

Popular press
The book was reviewed in the popular press, including in The Wall Street Journal,[3] The New York Times,[4] and the
New Yorker.[5] It was also briefly mentioned in Time Magazine.[6] Nicholas Kristof wrote in the New York Times that it
was the "best political book of this year."[7]

Academic press
The book received a mixed review from the libertarian Austrian economist Walter Block in the Journal of Libertarian
Studies.[8] Block was highly critical of Caplan's attempts to paint Austrian economics as a form of irrational free-
market extremism. He also criticized Caplan for not referencing Hans-Hermann Hoppe's book Democracy: The God
That Failed that had a similar theme. Block's review was also published in LewRockwell.com and Psychology Today.
[9][10]

The book received a mixed-to-positive review from Loren Lomasky in Public Choice, co-inventor of the theory of
"expressive voting" that was a close competitor to Caplan's theory of rational irrationality.[11] Stuart Farrand wrote a
critique of Caplan's book for Libertarian Papers.[12] Gene Callahan reviewed the book for The Independent Review.[13]
Prema Popat of NorthEastern University and Benjamin Powell of Suffolk University jointly wrote a review of the book
for New Perspectives on Political Economy.[14]

Prior to publication of the book, Caplan had put forward the main thesis of the book as the lead essay in the November
2006 issue of Cato Unbound.[15] Other participants in the debate, who critiqued various aspects of Caplan's thesis,
included David Estlund, Loren Lomasky, and Jeffrey Friedman.[16]

Related books

Books published earlier

Democracy and Decision by Geoffrey Brennan and Loren Lomasky, where the authors describe their "expressive
voting" thesis in detail. Caplan's theory of rational irrationality is a close competitor to the theory offered here, and
is in many ways similar. Lomasky wrote a review of Caplan's book.[11]
The Myth of Democratic Failure by Donald Wittman, the book that Caplan says was the impetus for writing his own
book. Caplan included Wittman's book on his reading list, writing "This is the book that awoke me from my
dogmatic public choice slumbers—and (negatively) inspired all of my work on voter irrationality. It's a gift." Caplan

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and Wittman participated in a public debate shortly after Caplan's book was released.[17]

Books published later

The Ethics of Voting by Jason Brennan, a 2011 book examining whether people have a moral obligation to vote.
Brennan argued that people are not morally obliged to vote, but that if they do vote, they are obliged to vote
responsibly. He argued that people who are not confident that they can vote well should refrain from voting. The
final chapter of Brennan's book reviewed the evidence regarding whether people are generally well-qualified to
make responsible voting decisions, and this chapter referenced The Myth of the Rational Voter.
Against Democracy by Jason Brennan, a 2016 Princeton University Press book that challenges the belief that
democracy is good and moral, and argues that the system doesn't produce good enough results. Furthermore,
Brennan presents and defends different alternatives of "the rule of the knowledgeable" (epistocracy), where only
the most knowledgeable voters get to elect the leaders.[18] Caplan has endorsed the book.[18]

See also
Behavioral economics

References
1. Bryan Caplan, The Myth of the Rational Voter: Why Democracies Choose Bad Policies (Princeton University
Press, 2007).
2. W. Michael Cox and Richard Alm, Myths of Rich and Poor (New York: Basic Books, 1999), p. 128. Cited in Bryan
Caplan, The Myth of the Rational Voter, p. 42.
3. Casse, Daniel (2007-07-10). "Casting a Ballot With A Certain Cast of Mind" (https://www.wsj.com/articles
/SB118401997995161399). Wall Street Journal. Retrieved 2013-09-29.
4. Bass, Gary J. (2007-05-27). "Clueless" (https://www.nytimes.com/2007/05/27/magazine/27wwln-idealab-
t.html?_r=0). New York Times. Retrieved 2013-09-29.
5. Menand, Louis (2007-07-09). "Fractured Franchise Are the wrong people voting?" (http://www.newyorker.com
/arts/critics/books/2007/07/09/070709crbo_books_menand). New Yorker. Retrieved 2013-09-29.
6. Fox, Justin (2007-04-26). "The Myth of the Rational Whatever" (http://business.time.com/2007/04
/26/the_myth_of_the_rational_whate/). Time Magazine. Retrieved 2013-09-29.
7. https://www.nytimes.com/2007/07/30/opinion/30kristof.html
8. Block, Walter (2011). "The Myth of The Rational Voter (book review)" (https://mises.org/journals/jls/22_1
/22_1_35.pdf) (PDF). Journal of Libertarian Studies. pp. 689–718. Retrieved 2013-09-29.
9. Block, Walter (2007-08-25). "The Trouble With Democracy" (http://archive.lewrockwell.com/block/block84.html).
LewRockwell.com. Retrieved 2013-10-13.
10. Block, Walter (2011-12-25). "Review of "The Myth of the Rational Voter": What's missing from this Bryan Caplan's
critique of democracy" (http://www.psychologytoday.com/blog/defending-the-undefendable/201112/review-the-
myth-the-rational-voter). Psychology Today. Retrieved 2013-10-13.
11. Lomasky, Loren (June 2008). "Swing and a myth: a review of Caplan's The Myth of the Rational Voter"
(http://www.springerlink.com/content/k6396012k8647800/). Public Choice. 135 (3–4): 469–84.
doi:10.1007/s11127-007-9273-7 (https://doi.org/10.1007%2Fs11127-007-9273-7). Retrieved 2013-09-29.
12. Farrand, Stuart (2010). "Critique of Caplan's The Myth of the Rational Voter" (http://libertarianpapers.org/articles
/2010/lp-2-28.pdf) (PDF). Libertarian Papers, Vol. 2, Article No. 28. Retrieved 2013-09-29.

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13. Callahan, Gene (Winter 2009). "The Myth of the Rational Voter: Why Democracies Choose Bad Policies (book
review)" (http://www.independent.org/publications/tir/article.asp?a=723). The Independent Review. Retrieved
2013-09-29.
14. Popat, Prema; Powell, Benjamin (2007). "Bryan Caplan: The Myth of the Rational Voter (book review)"
(https://web.archive.org/web/20120729171646/http://pcpe.libinst.cz/nppe/3_1/nppe3_1_8.pdf) (PDF). New
Perspectives on Political Economy. Archived from the original (http://pcpe.libinst.cz/nppe/3_1/nppe3_1_8.pdf)
(PDF) on 2012-07-29. Retrieved 2013-10-13.
15. "The Myth of the Rational Voter" (http://www.cato-unbound.org/2006/11/06/bryan-caplan/the-myth-of-the-rational-
voter/). Cato Unbound. 2006-11-05. Retrieved 2013-08-17.
16. "Majority Fools? Irrationality and the Limits of Democracy" (http://www.cato-unbound.org/issues/november-
2006/majority-fools-irrationality-limits-democracy). Cato Unbound. November 2006. Retrieved 2013-09-29.
17. "Wittman-Caplan debate" (http://econfaculty.gmu.edu/bcaplan/wittdeb.htm). Retrieved 2013-10-13.
18. "Brennan, J.: Against Democracy (eBook and Hardcover)" (http://press.princeton.edu/titles/10843.html).
press.princeton.edu. Retrieved 2016-10-01.

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