Eric Crampton was there with me on opening night for The Fellowship of the Ring.  Now this former EconLog guest blogger is a professor in Middle Earth, a.k.a. New Zealand.  And he’s finally started his own blog, Offsetting Behavior, to publicize his research.  Eric’s latest paper tests the Miracle of Aggregation for NZ voters – and finds it wanting:

Using a dataset allowing for testing of ignorance’s effects, I here have shown that ignorance correlates reasonably strongly with policy and party preferences and with failure to understand economics. Moreover, the effects are not trivial, often well outpacing the effects of education. Even worse, membership in the types of organizations most likely able to provide adequate cue-givers fails to substantially attenuate ignorance’s effects. We can perhaps take some comfort in that the politically ignorant also are somewhat less likely to vote.

But wait, there’s more!  Eric also checks whether my results from “What Makes People Think Like Economists?” hold up in NZ.  Education and male gender still matter a lot, but in NZ, unlike the US, income has a big effect:

The biggest absolute effect comes from having a very high income: being
in the top income bracket increases your “economic thinking” score by
0.39 standard deviations. Second, Maori ethnicity reduces the score by
0.31 standard deviations. Next, having a university degree increases
the score by 0.29 standard deviations. Being male increases the score
by 0.25 standard deviations. Identifying with a left-wing ideology
reduces the score by 0.2 standard deviations.

Another interesting result:

Caplan finds that expected income growth correlates with economic
thinking. I similarly find that those with a better household financial
situation as compared to the prior year also think more like economists
(0.1 standard deviations), but those who expect the economy to do worse
in the next year also think more like economists. As Caplan’s study
relied on data from 1996 and mine from 2005, perhaps those who think
more like economists are better able to forecast economic trends.


P.S. Eric takes econometric requests.  I asked him to check whether dropping his measure of ignorance restored the dominance of education over income.  Not quite; dropping ignorance made education more important and income less important, but the changes were modest.  In the end:

The effects of income and education are roughly comparable. The lowest
levels of both have little effect. Middling levels of both have some
effect. And the highest levels of each have a strong effect. Having an
undergraduate university degree has a stronger effect than having the
second-highest level of income, but being in the highest income bracket
looks to have a stronger effect than being in the highest education