If people are rational on Monday and irrational on Tuesday, it is a good idea to shift decision-making to Monday.Read more at location 2117
One could postulate voter irrationality as an ad hoc exception to the laws of human behavior. But ad hoc exceptions to well-established principles understandably provoke skepticism.Read more at location 2122
Alice laughed. “There’s no use trying,” she said. “One ca’n’t believe impossible things.” “I dare say you haven’t had much practice,” said the Queen. “When I was your age, I always did it for half- an-hour a day. Why, sometimes I’ve believed as many as six impossible things before breakfast.”Read more at location 2130
The desire for truth can clash with other motives. Material self-interest is the leading suspect. We distrust salesmen because they make more money if they shade the truth.Read more at location 2134
Dasgupta and Stiglitz deride the free-market critique of antitrust policy as “well-funded” but “not well-founded.”Read more at location 2136
Social pressure for conformity is another force that conflicts with truth-seeking.6 Espousing unpopular views often transforms you into an unpopular person.Read more at location 2139
On many topics, one position is more comforting, flattering, or exciting, raising the danger that our judgment will be corrupted not by money or social approval, but by our own passions. Even on a desert isle, some beliefs make us feel better about ourselves. Gustave Le Bon refers to “that portion of hope and illusion without which [men] cannot live.”Read more at location 2144
The Christian must be enabled to think with complacency that everybody not of the Christian faith will be damned. The Brahman must be given grounds for rejoicing that he alone is descended from the head of Brahma and has the exalted honor of reading the sacred books. The Buddhist must be taught highly to prize the privilege he has of attaining Nirvana soonest. The Mohammedan must recall with satisfaction that he alone is a true believer, and that all others are infidel dogs in this life and tormented dogs in the next. The radical socialist must be convinced that all who do not think as he does are either selfish, money-spoiled bourgeois or ignorant and servile simpletons. These are all examples of arguments that provide for one’s need of esteeming one’s self and one’s own religion or convictions and at the same time for the need of despising and hating others.10Read more at location 2149
Jost and his coauthors casually remark in the Psychological Bulletin that “Nearly everyone is aware of the possibility that people are capable of believing what they want to believe, at least within certain limits.”Read more at location 2160
They are mistaken. I observe one person’s preferences every day—mine. Within its sphere I trust my introspection more than I could ever trust the work of another economist.Read more at location 2167
One thing my introspection tells me is that some beliefs are more emotionally appealing than their opposites.Read more at location 2170
Introspection is a fine way to learn about your own preferences. But what about the preferences of others?Read more at location 2174
I can easily overlook any present momentary sorrow when I reflect that it is in my power to be happy a thousand years hence. If it were not for this thought I had rather be an oyster than a man.Read more at location 2184
Many autobiographies describe the pain of abandoning the ideas that once gave meaning to the author’s life. As Whittaker Chambers puts it: So great an effort, quite apart from its physical and practical hazards, cannot occur without a profound upheaval of the spirit.Read more at location 2188
No wonder that—in his own words—Chambers broke with Communism “slowly, reluctantly, in agony.”21 For Arthur Koestler, deconversion was “emotional harakiri.”Read more at location 2192
The desire for “hope and illusion” plays a role even in mental illness.23 According to his biographer, Nobel Prize winner and paranoid schizophrenic John Nash often preferred his fantasy world—where he was a “Messianic godlike figure”Read more at location 2198
Listen to Böhm-Bawerk trace the psychological appeal of Marxian exploitation theory: It drew up the line of battle on a field where the heart, as well as the head is wont to speak. What people wish to believe, they believe very readily. . . . When the implications of a theory point toward raising the claims of the poor and lowering those of the rich, many a man who finds himself faced with that theory will be biased from the outset. And so he will in large measure neglect to apply that critical acuity which he ordinarily would devote to an examination of scientific justification.Read more at location 2204
It is dangerous to think that poisonous substances are candy. It is dangerous to reject the theory of gravity at the top of the stairs.Read more at location 2223
The cost of error varies with the belief and the believer’s situation. For some people, the belief that the American Civil War came before the American Revolution would be a costly mistake. A history student might fail his exam,Read more at location 2237
Normally, however, a firewall stands between this mistake and “real life.” Historical errors are rarely an obstacle to wealth, happiness, descendants, or any standard metric of success. The same goes for philosophy, religion, astronomy, geology, and other “impractical” subjects.Read more at location 2240
Virtually the only way that mistakes on these questions injure you is via their social consequences. A lone man on a desert island could maintain practically any historical view with perfect safety.Read more at location 2247
To use economic jargon, the private cost of an action can be negligible, though its social cost is high.Read more at location 2256
the typical citizen drops down to a lower level of mental performance as soon as he enters the political field.Read more at location 2273
Recognizing irrationality is typically equated with rejecting economics.34 A “logic of the irrational” sounds self-contradictory.Read more at location 2279
People have preferences over beliefs: A nationalist enjoys the belief that foreign-made products are overpriced junk; a surgeon takes pride in the belief that he operates well while drunk. Figure 5.2 The Demand for Irrationality • False beliefs range in material cost from free to enormous: Acting on his beliefs would lead the nationalist to overpay for inferior domestic goods, and the surgeon to destroy his career. Snapping these two building blocks together leads to a simple model of irrational conviction.Read more at location 2283
rational ignorance assumes that people tire of the search for truth, while rational irrationality says that people actively avoid the truth.Read more at location 2293
Doublethink means the power of holding two contradictory beliefs in one’s mind simultaneously,Read more at location 2329
the steps should be conceived as tacit. To get in your car and drive away entails a long series of steps—take out your keys, unlock and open the door, sit down, put the key in the ignition, and so on.Read more at location 2337
Step 1: Be rational on topics where you have no emotional attachment to a particular answer. Step 2: On topics where you have an emotional attachment to a particular answer, keep a “lookout” for questions where false beliefs imply a substantial material cost for you. Step 3: If you pay no substantial material costs of error, go with the flow; believe whatever makes you feel best. Step 4: If there are substantial material costs of error, raise your level of intellectual self-discipline in order to become more objective. Step 5: Balance the emotional trauma of heightened objectivity—the progressive shattering of your comforting illusions—against the material costs of error.Read more at location 2342
Early in the history of the faith the Jains divided on the question of wearing clothes. The Shvetambaras or the “white-clad” were the liberals who took their stand on wearing at least one garment, whereas the stricter and more conservative Digambaras got their name from their insistence on going about, whenever religious duty demanded it, “clad in atmosphere.” Mahavira [the last of the founding prophets of Jainism] did not wear clothes, they pointed out, so why, when there is a religious reason for not wearing clothes, should they? The Shvetambaras were in the north and yielded a bit both to the cold winds and to the social and cultural influences of the Ganges River plain. The Digambaras, not looked at askance by the Dravidian residents of their southland, have more easily maintained the earlier, sterner attitudes down the years.Read more at location 2354
Mohammed, for instance, promises paradise to all who fall in a holy war. Now if every believer were to guide his conduct by that assurance in the Koran, every time a Mohammedan army found itself faced by unbelievers it ought either to conquer or to fall to the last man. It cannot be denied that a certain number of individuals do live up to the letter of the Prophet’s word, but as between defeat and death followed by eternal bliss, the majority of Mohammedans normally elect defeat.Read more at location 2366
As long as they are at peace or militarily have the upper hand, the belief that Allah brings the fallen to paradise gives psychological comfort with little risk. When they are losing, however, soldiers’ “standby” rationality kicks in.Read more at location 2376
On some interpretations of Hinduism, a widow must join her deceased husband on his funeral pyre, a practice known as sati. Fulfilling this duty supposedly has great rewards in the afterlife. On the surface, sati looks like a clear case of persistent irrationality despite deadly incentives. But the reality, explains anthropologist Robert Edgerton, is different. Few Hindu widows ever complied with their putative duty: “Even in Bengal where sati was most common, only a small minority of widows—less than 10 percent—chose sati although the prospect of widowhood was dismal at best.”47 Some of these were frankly murdered by their husband’s relatives. When the widow refused the pyre, she was not allowed to resume a normal life.Read more at location 2383
Marxist philosophers have dogmatic objections to modern biology and physics. Genetics is “a bourgeois fabrication designed to undermine the true materialist theory of biological development,” and relativity theory and quantum mechanics are “idealist positions” that “contravene[d] the materialism espoused by Lenin in Materialism and Empirio-Criticism.”Read more at location 2393
In biology, Stalin and other prominent Marxist leaders elevated the views of the quack antigeneticist Trofim Lysenko to state-supported orthodoxy,Read more at location 2396
Internationally respected physicists ran the Soviet atomic project, not Marxist ideologues.Read more at location 2401
We encounter the price-sensitivity of irrationality whenever someone unexpectedly offers us a bet based on our professed beliefs.59 Suppose you insist that poverty in the Third World is sure to get worse in the next decade. A challenger immediately retorts, “Want to bet?Read more at location 2434
Suppose a referendum determines whether we have policy A or policy B. A is $10,000 better for you. What is the material cost of believing the opposite and voting accordingly? The naive answer of $10,000 is wrong unless your vote is “decisive”; that is, if it reverses or flips the electoral outcome. This is possible only if the choices of all other voters exactly balance. Thus, in elections with millions of voters, the probability that your erroneous policy beliefs cause unwanted policies is approximately zero.Read more at location 2447
How many times have you heard, “Every vote matters”? But people are less credulous than they sound. The infamous poll tax—which restricted the vote to those willing to pay for it—provides a clean illustration. If individuals acted on the belief that one vote makes a big difference, they would be willing to pay a lot to participate.Read more at location 2458
Intuitively, if one vote cannot change policy outcomes, the price of irrationality is zero. This zero makes rational irrationality a politically pregnant idea.Read more at location 2468
Consider how the typical person forms beliefs about the deterrent effect of the death penalty. Ordinary intellectual self-discipline requires you to look at the evidence before you form a strong opinion. In practice, though, most people with definite views on the effectiveness of the death penalty never feel the need to examine the extensive empirical literature. Instead, they start with strong emotions about the death penalty, and heatedly “infer” its effect.Read more at location 2477
The death penalty is an unusually emotional issue, but its template fits most politically relevant beliefs.Read more at location 2482
The same people who practice intellectual self-discipline when they figure out how to commute to work, repair a car, buy a house, or land a job “let themselves go” when they contemplate the effects of protectionism, gun control, or pharmaceutical regulation.Read more at location 2488
Researchers at the intersection of psychology and economics often take a more radical position: Not only are people irrational, but their irrationality stays the same or increases as its cost rises.Read more at location 2517
a recent paper finds that people get less overconfident when they have to bet real money on their beliefs.Read more at location 2528
Economic actors in their “natural habitat” look considerably more rational than they do in the lab.Read more at location 2538
A common summary of the experimental literature is that incentives improve performance on easy problems but hurt performance on hard problems.Read more at location 2544
the difficulty of a problem falls if you have more time and flexibility to solve it. Hard problems naturally decay into easier problems. Once they are easy enough, incentives workRead more at location 2549
The typical person faces both practical questions—doing his job, buying groceries, or driving—and impractical ones—like politics and religion. It is hard to deny that both intellectual effort and accuracy are much higher for practical questions.Read more at location 2555
Brennan and Lomasky point to the expressive function of voting. Fans at a football game cheer not to help the home team win, but to express their loyalty. Similarly, citizens might vote not to help policies win, but to express their patriotism, their compassion, or their devotion to the environment. This is not hair-splitting. One implication is that inefficient policies like tariffs or the minimum wage might win because expressing support for them makes people feel good about themselves.Read more at location 2572
Case in point: When economists analyze discrimination, they emphasize the financial burden of being a bigot.89 In politics, the social cost of prejudice remains, but the private cost vanishes due to voters’ low probability of decisiveness:Read more at location 2579
The key difference is the mechanism. In expressive voting theory, voters know that feel-good policies are ineffective. Expressive voters do not embrace dubious or absurd beliefs about the world. They simply care more about how policies sound than how they work. The expressive protectionist thinks: “Sure, protectionism makes Americans poorer. But who cares, as long as I can wave the flag and chant ‘U.S.A.! U.S.A.!’ ” In contrast, rationally irrational voters believe that feel-good policies work.Read more at location 2594
Economists have often been criticized for evading the differences between political and market behavior.98 But this is a failure of economists rather than a failure of economics. Economists should never have expected political behavior to parallel market behavior in the first place. Irrationality in politics is not a puzzle. It is precisely what an economic theory of irrationality predicts.Read more at location 2651
84. Harrison and List (2004); List (2003).
