Public choice is arrogant

I’m reading through Randy Simmons’ Beyond Politics: The Roots of Government Failure for my Microeconomics class. You could call it a primer on public choice.

I’m skeptical of public choice. Most public choice literature I’ve read makes big assumptions about the nature and strength of people’s incentives—a logical jump I’ve written about before.

Much to my surprise, this book has actually increased my skepticism. It’s chock full of assumptions about how people respond to incentives, and makes everything worse by using these assumptions to build an entire theory of how politics works.

For example, consider the following claim made in Chapter 3 of the book:

If a politician has a choice of dividing a million dollars equally among a million citizens or equally among a thousand people she will rationally opt for the later option because she is more likely to win the gratitude of those who gained $1,000 than of those getting but one dollar apiece.

I hope you see the problem. Simmons can’t possibly know this is true. In fact, I’d bet it’s not true. Voters rarely vote according to whether or not a politician helped them personally. They look at how a candidate has changed things overall—how their constituency has performed under his or her supervision. Sure, getting a check for $1,000 might change that, but very few people get such handouts or receive significantly more favors than the average voter. And besides, even those voters who do receive handouts also have the politician’s general economic policies to consider—policies that can have just as big, if not a bigger, influence on their personal financial success.

But whether this is or isn’t true isn’t what matters. Where this analysis is flawed–even dangerous–is when it’s passed off as settled fact and not as theory.

Simmons could just as easily assert something along these lines: If a politician has a choice of dividing a million dollars equally among a million citizens or equally among a thousand people, she will rationally opt for the former option because voters generally despise interest-group pandering and she’d risk losing more votes than she’d gain.

He didn’t, though, because that’s not how he predicts these particular incentives would operate. But his prediction is imperfect. Other theorists hold different views. Therefore, his claim shouldn’t be leveled as “she will rationally opt for the latter,” as if there’s no question. Instead, he should add a disclaimer noting his big assumption about how voters would respond to such an event.

In a word, I guess my problem with public choice is it’s arrogance. It’s the type of arrogance that often gives economists a bad name. Arrogance to think that consumer preferences can be known beyond the fact that they prefer what will satisfy their ends. Arrogance to think that this or that policy will result in this or that outcome without any degree of uncertainty.

As I’ve written before, the fact that any politician was ever re-elected who actually reduced spending, cut taxes, ignored special interest lobbyists and trimmed down bureaucracy proves public choicers wrong when they say that voters always, everywhere reward only those politicians who cater to their “parochial concerns.”

A fitting post for Election Day, I think.