The Economics of Political Balderdash
By David Henderson
It would not be a satisfactory economic explanation to simply hypothesize that Trump is an idiot in the sense of being cognitively impaired. As David Friedman reminds us, it is better to assume that Trump–or any other politician–is a rational individual who uses effective means to reach his self-interested goals. This is true even if Trump is ignorant of the finer, and less fine, points of social theory and political philosophy.
We know from public choice theory that lying is more rational for a politician than for individuals in other walks of life. A politician’s lies are less likely to be noticed or remembered by the “rationally ignorant” voter. Rational ignorance means that the individual voter has little incentive to invest time and money in gathering and analyzing political information because he will not be able, with his single vote, to change the election result. The politician running for office also has an incentive to lie when deprecating his opponents’ character. If he wins, there will be no way to know whether or not his opponents would have been as bad as he claimed. And since the politician has no property rights in his office, the discounted value of his political reputation over time is very low, giving him an incentive to trade long-term credibility for short-run victories.
This is from Pierre Lemieux, “The Economics of Political Balderdash,” Econlib Feature Article for April.
As the blurb for the article says:
Much of the language used by prominent politicians goes in one ear and out the other. We regard it as balderdash. This month’s author, Pierre Lemieux, suggests that balderdash is purposeful, that it is part of a successful politician’s tool kit. Lemieux analyzes some examples from our current and previous U.S. presidents and suggests that political balderdash be considered one of the cognitive biases that behavioral economists focus on.
Make sure you don’t miss the last part of the piece, under the sub-heading “Behavioral economics.”