The myth of the rational voter: why democracies choose bad policies

Abstract

Voters are systematically irrational, and this irrationality has profound effects on policy. The public underestimates the benefits of markets, of dealing with foreigners, of conserving labor, and of past and future economic performance. Economists and the public disagree widely about economic policy, and this gap is primarily driven by systematic errors in the public’s thinking. This book argues that voters are irrational not because they are ignorant, but because they prioritize their psychological well-being over their material well-being. Because their votes are unlikely to change the outcome of an election, voters face no material cost for indulging their false beliefs. Politicians, for their part, are not primarily driven by self-interest, but by the desire to win elections by conforming to voter preferences. They therefore have little incentive to correct popular errors. The result is that democracies make a lot of bad decisions, driven by the public’s persistent misconceptions. – AI-generated abstract