Rational Irrationality

by Russ Roberts on October 5, 2004

in Prices

Tyler over at Marginal Revolution has some fascinating statistics on the financial impact of the Palestinian Intifada. Bottom line—the intifada has been unbelievably expensive. Employment in Israel for Palestinians has dried up, incomes are way down, life stinks.

Yet many Palestinians support the intifada, and obviously some are willing to die for it. I conclude that economists need a better theory of human irrationality. Analogies from expressive voting theory suggest that (many) Palestinians support the intifada because their voices are not decisive. The support is seen as a kind of “cheap talk,” leading to a collective insanity which perhaps no single person intended. But do individual Palestinians who support the intifada really mind that so many other people go along with them? Doubtful, the contrary is sooner true, namely that people prefer that their peers follow their position.

I have a different take. I have no idea what Palestinians think of the intifada and no one else does either. No one born and raised in America can fully understand what it’s like to live in a society without the rule of law. Any time there are groups of people who kill those who disagree with them, you can’t assume that what people do or say reflects how they really feel.

Go to a party where the other 30 guests feel the same way you do about some important policy question, such as who to vote for or what to do about education. Then go across the hall where the other 30 guests are on the other side. Most people act differently at the two parties. Your demeanor is different. Your words are different. You feel different inside. Sure, there are folks who act the same way at both parties. In fact, it’s an interesting test of maturity. But most people act differently. Now imagine how you’d act at the party across the hall if you knew there was a chance, a non-trivial chance, that you might be shot for disagreeing with the host. Everything changes.

People talk about the stifling effect on free speech of the political correctness movement. I think the effect is exaggerated. But living in a thugocracy ruled by violence is the real thing. Living under the Palestinian Authority is to live under a thugocracy. And I’m not even sure who the thugs are. There are multiple candidates. The same is true in Iraq. We have no idea what “the people” really think of American involvement. I’m sure there are a bunch who are thrilled to have satellite dishes and a dead Saddam Hussein. But there’s no return to saying so. In a society of violence you keep your head down.

I’m sure there are a bunch of Palestinians who hate Israelis, hate Jews and who think it glorious when someone kills a bunch of Israelis sitting in a cafe. I’m sure that the murderer who wears the bomb thinks it’s worth doing. That people are willing to die for what they believe in is fascinating. But it has been and always will be a small group. It’s the rest of the people whose views are unknowable to us. Consider the Palestinians who dance in the street and celebrate those cafe deaths. How many would dance in a different society, a society where dancing would be shameful? A society where speaking out against murder is safe? That’s the key question. We don’t know the answer.

An earlier take of mine on the incentives of thugocracy is here.

Be Sociable, Share!

Comments

comments

Add a Comment    Share Share    Print    Email

Previous post:

Next post: