“Why Haven’t We Been Taught This Material Until Now?”

by Don Boudreaux on July 19, 2016

in Economics, Politics, Reality Is Not Optional

Every summer since 2011 I’ve taught an intro economics course for undergraduate interns brought to D.C. by my dear friends at the Fund for American Studies.  (Since 2013, this course has been offered through my home institution, George Mason University.)  Almost all of the students are Americans who study at American colleges and universities.  The majority of these students are aspiring journalists.

As always, near the end of the course I cover foundational public-choice economics – including an introduction to Arrow’s Impossibility Theorem.  Summarizing the conclusions of this literature as succinctly as my meager writing skills permit, Arrow’s theorem – made famous by Nobel laureate economist Kenneth Arrow (and often explained using examples from the work of the Scotsman Duncan Black) – says that it is impossible for any collective decision-making mechanism or procedure to generate outcomes that reflect only the preferences of the choosers.  The outcomes of all collective decision-making mechanisms or procedures – including majoritarian voting – necessarily are determined in part by the manner in which those mechanisms or procedures are used to settle upon outcomes.  Put differently, Arrow proved that it is impossible to devise any collective decision-making mechanism or procedure that generates results free of the influence of arbitrary factors (that is, factors that reasonable people believe should not play a role in determining the outcomes of decision-making procedures).

The short conclusion for majoritarian voting is this: the preferences of the voters are not the only factors that determine the outcomes of elections.  If the manner in which the vote in conducted is changed, the outcome of an election will change even if no voter’s preferences change.

Put even more succinctly: in almost all elections, there isn’t only one correct outcome.  There isn’t one outcome that reflects the individual-voters’ collective “preference” better or more accurately than some other possible outcomes.  Stated differently, in almost all collective-decision-making settings, there is no “will of the people.”  It’s a mistake to anthropomorphize a group of people.  Each individual has preferences; a collection of individuals has only a collection of individual preferences and not a separate and determinate group preference.

This material is pretty heady stuff, for an understanding of it drains away much of the foolish romance that many people have about ‘the people’s will’ being discovered and implemented through non-corrupt democratic voting.  (And when the work of other public-choice-oriented scholars such as Jim Buchanan, Gordon Tullock, Mancur Olson, Anthony Downs, Bob Tollison, Bruce Yandle, Charlie Goetz, Charlie Plott, Dwight Lee, Roger Meiners, Fred McChesney, Bob Higgs, Geoff Brennan, Loren Lomasky, Bill Shughart, Randy Holcombe, Sam Peltzman, Mark Crain, Viktor Vanberg, Russ Sobel, Roger Congleton, and George Stigler – along with many of my current colleagues, including Dick Wagner, Bryan Caplan, Thomas Stratmann, and Alex Tabarrok – are added to the mix, the notion that the government consistently acts to promote some identifiable ‘public welfare’ becomes downright laughable.)

After running this evening in class through a few examples of Arrow’s Impossibility Theorem, a young woman raised her hand to ask me: “What year did you say Professor Arrow won the Nobel Prize?”

1972,” I replied.

“How come, then, we’ve never heard of him until just now, in your class?” she sensibly and earnestly inquired.  “Why haven’t we been taught this material until now?”

Good – great! – question.  I don’t know the answer.  I do know, however, that it’s appalling that the typical college student today is ‘taught’ only the unscientific, romantic view of democratic government and is never exposed – save at schools such as GMU – to the science of public choice.

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