Good Policy Choices Even When Voters Entertain Biased Beliefs: A Model with Endogenous Valence

Political Analysis, 2001

This paper illustrates one strategy for testing a theory of economic influences on voting. We use a competitive equilibrium model of the economy to determine the impact of an individual's economic position on his or her economic interests and, ultimately, political interests. We then test whether this impact is observed in voting behavior, addressing the resulting specification and estimation problems in the context of U.S. presidential election data. Our empirical results suggest that, despite these formidable problems, we can usefully connect political-economic models and discrete-choice (probit) models of voting.

Electoral Studies, 2013

In this essay, we discuss the usefulness and meaning of empirical models of economic voting that rely on measures of individual economic perceptions. The effort is motivated by the recent reappearance of a long-standing critique of the use of economic perceptions data in individual level economic voting studies, with a consequent call for the use of aggregate data, which suggests that variation in perceptions must reflect noise or error because there can be only one "real" state of the national economy applicable to all respondents in any national survey. We show, however, that this critique (and its corresponding prescriptions for how to specify empirical models of economic voting) is based on a misunderstanding about (1) the theoretical concepts called for by the leading theories of economic voting (and that we should be trying to measure), (2) the nature of the economy that individuals can actually observe (it is a distribution of possible states, not a point) and, consequently, (3) the interpretation of correlations between individual economic perceptions and electoral support.

Since individuals cannot affect public policies they have no incentives to invest in costly political knowledge for that that reason, and the assumption in standard political economy models that people know how public policies affect their economic interests is consequently problematic. We argue in this paper that the incentive to acquire political knowledge is a byproduct of other incentives, both private social, and that these incentives are unequally distributed across groups in the electorate. In our amended political economy model of voting, the process of political knowledge acquisition is endogenous and we show how this has notable implications our understanding of distributive politics across democracies. We test the model on public opinion data from 18 advanced democracies and show that the coupling between economic interests and political choice is much stronger in some economic classes, and in some political systems, than in others.

2007

2006

Economic theories of voting argue that party popularity and vote are heavily influenced by the performance of the economy. Inferences about the direction of causality between perceptions of the economy and party support remain questionable, however. This article evaluates the microfoundations of economic theories of voting and party popularity using multiwave panel data.

2015

When people vote, does their preferred candidate represent the policies that are best for them? Not necessarily – a lack of information can often lead to people voting ‘incorrectly’ against their interests or beliefs. Using a new method of measuring this incorrect voting in presidential elections, Aaron Dusso finds that when choosing between candidates, strong partisans and those who believe that the economy is doing better for them, but who also have poor knowledge of candidates’ policy positions, are much more likely to vote for the ‘wrong’ candidate.

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There is one clear exception to this statement, given certain theoretical and empirical assumptions: when partisan bias in perception of candidates' policy positions reflects "partisan stereotyping" (Rahn 1993). However, such stereotyping is only compatible with democratic precepts under two, rather strict, conditions: partisan labels are reliable indicators of candidates' policy positions, and voters actually know what policy positions go with what partisan label.

Public Choice, 2007

Electoral Studies, 2004

Using panel surveys conducted in Great Britain before and after the 1997 general election, we examine the relationship between voting behavior and post-election economic perceptions. Drawing on psychological theories of attitude formation, we argue that those who voted for Labour and the Liberal Democrats perceived the past state of the British economy under the Tory government more negatively than they had prior to casting their ballot in the 1997 election. Similarly, we posit that Labour supporters would view the future state of the national economy under Labour more positively than they had before the election. This indicates that, contrary to many assumptions in the economic voting literature, voting behavior influences evaluations of the economy as voters seek to reduce inconsistencies between their vote choice and evaluations of the economy by bringing their attitudes in line with the vote they cast in the election. It also means that voters' post-election economic perceptions are, at least in part, influenced by and thus endogenous to their vote choice. This finding has two major implications: first, cross-sectional models of economic voting are likely to overestimate the effect of economic perceptions on the vote. Second, the endogeneity of economic perceptions may compromise the quality of economic voting as a mechanism for democratic accountability. #

2006

The psychological partisan effect of electoral systems: How ideology correlates with strategic voting, 2023

Districted proportional systems give an edge to right-wing parties that are more popular in rural areas where district magnitude is small and large parties are mechanically advantaged. In this paper, we explore the role played by voters in this bias by looking at how ideology correlates with strategic voting. We analyze survey data from 44 elections in Western Europe and find that left-wing voters are more likely to support a party that is not viable (p < 0.01), but once in this position they seem less likely to desert this party for one that is viable (p < 0.1). Further, we find that this pattern is likely driven by the intensity of partisan preferences as left-wing voters are on average more attached to their favorite party and thus more reluctant to desert it (p < 0.01). Our study thus demonstrates that the psychological effect of districted proportional systems amplifies the mechanical one in advanced industrial democracies.

Electoral Studies, 2000

The notion that voters are rational causes three closely related paradoxes: the paradox of voting, the paradox of indeterminacy and the paradox of ignorance. In this paper, we discuss the paradox of ignorance, i.e., the claim that the rational voter is uninformed about economic and political issues. We argue that the paradox of ignorance exaggerates the degree of voter ignorance. We maintain that voters, on average, are ignorant about the economy because of the consumption cost of information. Nevertheless, some voters do have an incentive to become informed, either because vote-relevant information is collected as a by-product of other activities or because information has value in social interaction.

Journal of Theoretical Politics, 2006

This article begins with a general discussion of the epistemology of rational choice, and argues that there are important questions in political science for which rational choice theory is not a particularly useful epistemic tool. It is further argued that part of the problem lies with the particular vision of methodological individualism that is inherent in the use of classical rational choice assumptions in game theoretic models. An alternative approach that endogenizes the way in which people form beliefs is then advocated as a potential solution to this problem, both as a means to expand the substantive reach of optimizing theories in political science, as well as a way of incorporating more psychological realism into models of political behavior. Two novel models allowing actors within political contexts to form beliefs in endogenous ways are then presented and discussed.

Journal of Public Economics, 2014

We consider a two period model in which an incumbent political party chooses the level of a current policy variable unilaterally, but faces competition from a political opponent in the future. Both parties care about voters payoffs, but they have different beliefs about how policy choices will map into future economic outcomes. We show that when the incumbent party can endogenously influence whether learning occurs through its policy choices (policy experimentation), future political competition gives it a new incentive to distort its policies-it manipulates them so as to reduce uncertainty and disagreement in the future, thus avoiding facing competitive elections with an opponent very different from itself. The model thus demonstrates that all incumbents can find it optimal to 'over experiment', relative to a counter-factual in which they are sure to be in power in both periods. We thus identify an incentive for strategic policy manipulation that does not depend on self-serving behavior by political parties, but rather stems from their differing beliefs about the consequences of their actions.

2008

Accurate expectations about the outcome of elections play a central role in psychological and economic theories of voting. In the paper, three questions about voters' expectations are investigated. First, we identify and test several factors that influence the overall accuracy or quality of voters' expectations. Second, the phenomenon of "wishful thinking" is tested and confirmed for expectations about the electoral performance of individual parties and coalitions. Finally, two mechanisms how expectations might influence voting behavior are identified and tested. Based on surveys from Austria and Germany, the results suggest that voters not only rely on expectations to avoid casting "wasted" votes for parties without electoral chances, but that they are able to engage in fairly sophisticated strategic coalition voting.