March 12, 2008

Rationality vs. Economics

This weekend I attended a panel at the South by Southwest interactive conference called The Myth of the Rational Voter. I found it frustrating on some level that is hard to articulate. It probably has to do with ideological differences I have with the panel’s presenter, Bryan Caplan. I think he’s coming from a mainstream Libertarian perspective, where as I’m a bit more left-leaning in my economics.

Here is a short email exchange I had with him today:

Hi Bryan,

I was in the audience of your SXSW panel, and was part of the small group of folks who might have appeared agitated and unconvinced (I was the guy who interrupted and asked what other examples you had of the social benefits of markets).

My general response to your panel’s content is, perhaps, like a mini-version of my problem with (mainstream) economics as I see it: we are (the audience, the voters, the consumers, etc.) operating without enough information, but are capable of informing ourselves in our own ways. It’s an imperfect exercise, of course, but it draws on a potentially broader and more rich selection of information than, say, a WSJ toting Libertarian.

I feel like you were creating a false dichotomy between expert (elite) and non-expert (let’s be neutral and call them “plebes”). I feel like economics also fails to take that into account the self-educating, network-savvy individual.

With the Internet, us plebes can become better at informing ourselves in a more organic way, outside the structure of the academy. We may not have the training and lingo to launch an effective debate about your application of economics, but we are (at least I was) left with an intuitive feeling that something doesn’t fit right. And maybe ask a fumbling question that does more to position us as shrill, bleeding hearts than it does challenge the logic of your argument. I think the “crypto-fascist” guy is a good example of that. (There was a guy in the first row who asked a carefully worded question, accusing Bryan of being a “crypto-fascist.”)

Anyway, I actually decided to write you after listening to this one podcast episode that was about something similar to your talk. Not sure if you have the time or inclination to listen to it (or tell me what you think), but I thought I’d at least send it along just in case.

http://bloggingheads.tv/diavlogs/9058

Thanks, -Dan

Bryan responded:

Thanks for writing, Dan. I guess my main comment is that I’d like to see some evidence that the “organic way” of figuring the world out actually works - especially when it conflicts with the “inorganic” way.

I wrote back:

Hi Bryan,

Here’s an example: can I post this exchange, so far, to my blog? My proposition is the comments that emerge in response would be a more effective strategy than by studying material I consider to be expert (based on institutional validation).

Thanks, -Dan

He said to go ahead and post our exchange, and here it is. I’m not sure whether the comments of readers are necessarily in conflict with the inorganic (perhaps I would say “legitimate,” in irony-quotes) way of exploring these ideas, but my point is that I would expect my weblog’s audience to be more enriching on the topic of rationality in economics than cracking open a respected economics text.

Probably none of you guys attended the panel I’m talking about (or have read Bryan’s book at least one commenter has read Bryan’s book), but here is a brief summary of his talk:

In the world of new media, the notion that more voices makes for a better society governs much of what we do. But is this really the case? If everyone has equal input, doesn’t this essentially eliminate the value of more educated / expert opinions. In this presentation, George Mason University Associate Professor of Economics Bryan Caplan will explore the societal problems when everyone’s opinion has equal weight.

Also take a look at the Bloggingheads video, which treads similar ground, and leave your thoughts here if something strikes you as comment-worthy. The purpose of this isn’t just to debate economics theory (whether or not you think of yourself as qualified to participate), but also to question the inherent authority that comes with leading a panel at SXSW with an unchallenged position (that is, not offering a second economist on the panel to create a more balanced debate).

BTW, this (somewhat unintentionally) fits right into the theme I brought up earlier, what is this thing good for?.