Persuasion, Slack, and Traps: How Can Economists Change the World?

Contrary to my critics, voter irrationality does not imply that economists cannot mitigate political failure. With rational voters, reform-minded economists have few viable tactics; with irrational voters reformers have more options. Rational voters can be swayed only by facts and logic; irrational voters could respond to better rhetoric. Rational voters strategically punish those who ignore their policy preferences; irrational voters use less effective disciplinary strategies that create political slack. Even with irrational voters, efficiency-enhancing reform is hard. With rational voters, however, democracy’s failure to adopt a reform is strong evidence that the reform does not enhance efficiency.