We believe that Caplan has mistaken simple, inadvertent public ignorance—in this case, ignorance of economic theory—with deliberate (rational) avoidance of the truth (irrationality). In Caplan’s view, the public consciously decides to be ignorant of truths it does not want to know. “Don’t confuse me with the facts”—i.e., with the truth—is his summary of the public’s posture on economics (Caplan 2007, 102). Thus, the public’s so-called economic errors are actually perverse choices, not inadvertent mistakes.
— Stephen Earl Bennett and Jeffrey Friedman, “The Irrelevance of Economic Theory to Understanding Economic Ignorance,” Critical Review 20, 3 (2008), pp. 195–258.
In The Myth of the Rational Voter, Bryan Caplan argues that the best theory that accounts for the shortcomings of democracy — the enactment of bad policy — is his own “rational irrationality.” Rationality is defined as the search for truth, irrationality the opposite. Caplan further differentiates between different motives, where irrationality is caused by emotion and ideology, implying that truth-seeking stems from reason in the narrow sense of the term (e.g. logical deduction). In this world, there exists a tradeoff between reason and irrationality, where the latter offers good feelings at the expense of objectivity. Where the costs to a lack of objectivity are small, such as the case of voting, it becomes much more enticing to opt for a “feel good” action.1 The good feelings, I’d imagine, stem from a concern for social justice and helping fellow man — if, for instance, a voter supported raising the minimum wage out of solidarity.
Bennett and Friedman criticize Caplan’s “rational irrationality” as a contradiction in logic. They argue that Caplan’s theory must assume that the agent is knowingly embracing falsity. After all, the tradeoff is between feeling good and objectivity, implying that one knows that she is sacrificing truth. But, if the person knows that X is false, then why would she feel good about voting for it? It doesn’t make sense for the tradeoff to exist it all. I get the sense that Caplan goes back and forth between whether the voter is knowingly taking the false position or whether she genuinely believes hers is the correct one. This being said, if there’s one defense of his theory it’s that Caplan does suggest at one point that the tradeoff can be made subconsciously, where the mind literally papers over the objective truth to convince one that hers is the right belief. But, Caplan doesn’t make a detailed defense of this conjecture.
An important criticism of rational irrationality is that the person needs to actually know the truth in order to avoid it. I understand the point being made, but I’m not entirely convinced. An individual could attach an uncertain probability to her being right and a certain probability to each other alternative. She doesn’t even need to know the details of the alternative, only that there are concrete alternatives out there. A decision has to be made whether it’s worth exploring these alternatives (a decision also has to be made as to the value of exploring whether there are discrete alternatives). It’s possible that a person convince herself of being right to the point of purposefully avoiding having to discover contradictory ideas. For example, an economist might hold a strong position on business cycle theory. This economist knows that disagreement exists. But, the economist can also selectively choose which disagreements to familiarize herself with, allowing her to avoid the most challenging ones (at least, he ones she feels will be the most challenging).2 In a sense, this is still an ignorance based theory, but I think it’s close to Caplan’s argument as well.3
Truth be told, I’m more inclined towards Friedman’s alternative theory: radical ignorance. According to this theory, voters err because humans are cognitively limited. But, it’s not a rational ignorance — there’s no omniscient cost–benefit analysis to educating oneself. Rather, radical ignorance posits that there is knowledge that some agents don’t know about, making it impossible for that person to weigh the costs and benefits (how can you judge something you don’t even know exists?). It could be that economic theory tells us that protectionism harms society, but that voters aren’t aware of this theory. It could also be that voters don’t understand this theory very well — parts of it are unknown to them. Likewise, a person may not be aware of a particular application of a theory, so someone who doesn’t oppose the profit motive when it comes to her own shop may do so when it comes to big business (who, according to her, may enjoy “excess” profits).
I’ve been grappling with radical ignorance for a couple of years now. I’m not too convinced of the extreme case: complete ignorance of the unknown unknown. Instead, I think there are shades of radical ignorance. For example, it’s different to say that someone is completely ignorant of the unknown unknown and to claim that someone at least knows that there’s things she hasn’t learned yet (even if she doesn’t know what these things are). Similarly, a voter knows there are alternative positions and she has to decide to get to know them. The existence of choice doesn’t require omniscience. To me, the real value of radical ignorance theory is to force rational ignorance into the realm of realism. The individual simply does not have enough information to draw a perfect tradeoff curve, and that same individual may decide to interpret a data point in such a way that downplays the costs and benefits attached to it. The result is “non-optimal” decision making. There’s an important difference between being completely ignorant about something and just not knowing everything about everything, because the latter still allows room for a theory of choice.
Coming full circle, if there’s one thing in The Myth of the Rational Voter that can help radical ignorance theory it’s Caplan’s point on costs and incentives that impact decision-making. He argues that since in the private sphere the costs of a bad decision are internalized, it makes sense that voters don’t hold the same beliefs in everyday life (e.g. the average person who shops at the grocery store is unlikely to think that they’re being exploited for having to pay for food, yet may still be hostile towards the profit motive). He uses this to justify rational irrationality, but it can be taken in a different direction. In the market, loss forces the person to find and choose amongst alternative actions. In a democracy, this incentive may not be as strong (since the probability of costs is so low, and most of the costs are borne by others). This has to do directly with my point in the preceding paragraph: you can make a choice to explore the unknown unknown, and people do make cost–benefit analysis towards this end. Some institutional frameworks are better at forcing piecemeal changes than others.
I do think that Bennett’s and Friedman’s critique is damning. But, I think their theory of radical ignorance is stronger than it should be. If you make the requirements for radical ignorance less strict, there’s still room for Caplan’s book to provide a lot of valuable insight. The costs and benefits to voting impact the decision-making of the agent — whether ex ante or ex post (loss belonging to the latter) —; the democratic institutional framework simply doesn’t have a strong built-in process by which to punish poor decision makers. It has a weak system of forcing people to explore what’s out there and come up with alternative plans and ideas.4 Looking at it this way also helps us analyze the merits of democracy based on a dynamic model, rather than a static one that just looks at voters’ incentives ex ante.
1. Bennett, Friedman, and Caplan all accept the empirical evidence showing that the average voter votes with the social good in mind, rather than out of selfishness (narrowly defined).
2. I think that people avoid having their worldview shaken is an empirically valid possibility. This doesn’t necessarily imply the existence of rational irrationality (or they are actively choosing to believe something that they know is false), but it does suggest that people purposefully choose to discard information for the purpose of avoiding the displeasure of having your most important beliefs falsified. It’s extremely close to choosing to be ignorant.
3. It’s hard to tell whether Caplan fully unshackled himself from ignorance-based theories. He rejects rational ignorance for a variety of reasons, but he still holds that a better educated public would vote for better policy. Further, he argues that restricting voting to the best educated leads to better policy results. This contradicts his rational irrationality thesis, because these voters aren’t voting irrationality despite the fact that their vote matters as little as everybody else’s.
4. If I remember his piece, “Popper, Weber, and Hayek,” correctly, Friedman says as much, For example, p. xxiii,
In the absence of laboratory experimentation, piecemeal social engineering would, to be an error-correction process, require rigorous, informed counterfactual reasoning about social problems and the effects of putative political solutions to them.