Reports from the Economic Front

a blog by Marty Hart-Landsberg

Economic Enlightenment–Help!!!

A recent issue of an online journal, the Economics Journal Watch, included an article titled: “Economic Enlightenment in Relation to College-going, Ideology, and Other Variables: A Zogby Survey of Americans.”

Drawing on the results of a Zogby poll, the authors of the article concluded the following:

Economic enlightenment is not correlated with going to college, at least among the 4835 Americans who completed a Zogby International online survey. Economic enlightenment is highest among those self-identifying “conservative” and “libertarian,” and descends through “moderate,” “liberal,” and “progressive.”

Wow—is it true that college doesn’t contribute to economic enlightenment—and even more importantly that conservatives are more enlightened than progressives?

The question that immediately springs to mind is: what defines economic enlightenment?  And here is where it gets fun.  The Zogby survey which generated the data for the article included 21 questions on economics, 16 of which involved a question that required an answer in the following form:

1. Strongly Agree
2. Somewhat Agree
3. Somewhat Disagree
4. Strongly Disagree
5. Not sure

Of the 16 questions, the authors of the paper decided to focus on only 8 in their attempt to define economic enlightenment.  They “omitted 8 of the economic questions in that format because they are not as useful in gauging economic enlightenment, either because the question is too vague or too narrowly factual, or because the enlightened answer is too uncertain or arguable.”

So—here are the eight questions that the authors used to define economic enlightenment and the answers that defined unenlightened.  And, yes, I am taking this right from the article.

1. Restrictions on housing development make housing less affordable.
Unenlightened: Disagree

2. Mandatory licensing of professional services increases the prices of those services.
Unenlightened: Disagree

3. Overall, the standard of living is higher today than it was 30 years ago.
Unenlightened: Disagree

4. Rent control leads to housing shortages.
Unenlightened: Disagree

5. A company with the largest market share is a monopoly.
Unenlightened: Agree

6. Third-world workers working for American companies overseas are being exploited.
Unenlightened: Agree

7. Free trade leads to unemployment.
Unenlightened: Agree

8. Minimum wage laws raise unemployment.
Unenlightened: Disagree

Pretty unbiased, huh.  Clearly only an unenlightened person would think that free trade causes unemployment, or that multinationals exploit workers.  And only an unenlightened person would think that raising the minimum wage helps workers.

And remember these are the questions that are supposed to have clear cut, unambiguous answers.

There are in fact grounds for challenging the “correct” or “enlightened” answers to all of the questions—or at least demanding a clarification of what is the critical issue underlying the question.  For example, rent control doesn’t reduce housing supply for the simple reason that new housing is normally not covered by rent control.  A company that dominates a market might not be a monopoly in a technical sense but could well exercise monopoly like power.  As for comparing our standard of living now with 30 years ago—real wages are certainly lower.

This is downright embarrassing, what else can one say.

How about this for fun—if you have ideas for better questions send them along as comments.  Lets see if we can collectively create something a bit more useful.

Finally, if you have some extra time you might want to check out the results of a recent national survey by the Pew Center for the People and the Press  “that tests reactions to words and phrases frequently used in current political discourse.”  Among other things, the survey results revealed that:

“Socialism” is a negative for most Americans, but certainly not all Americans. “Capitalism” is regarded positively by a majority of the public, though it is a thin majority. There are certain segments of the public – notably, young people and Democrats – where both “isms” are rated about equally.

Young people are more positive about “socialism” and more negative about “capitalism” than are older Americans.  Among those younger than 30, identical percentages react positively to the words “socialism” and “capitalism” — 43% each.

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2 responses to “Economic Enlightenment–Help!!!

  1. Cliff Bekar May 10, 2010 at 10:53 am

    I do not think this is a fair critique of the article’s argument. The article clearly acknowledges that there are serious issues with the survey instrument: “We gauge economic enlightenment based on responses to eight economic questions. A number of controversial interpretive issues attend our measure, including: (1) our designation of enlightened answers; (2) an asymmetry in sometimes challenging leftist mentalities without ever specifically challenging conservative and libertarian mentalities; (3) our simple eight-question test is merely a baseline and does not gauge the heights of economic enlightenment; and (4) a concern about response bias (namely, that less intelligent people would be less likely to participate in the survey).”

    Point #1 & #2 clearly indicate that the study does not rely on the answers being “correct.” Further, points #3 & #4 go to the issue of ideological assumptions in the questions.

    The hypothesis is that taking some economics in college does not alter, in a systematic way, our answers on the survey. Taking college courses makes us neither more conservative or liberal, it has no impact at all, suggesting an economics education is no different from statistical noise in terms of how people respond to this survey. As noted by the authors, “Even with the caveats in mind, however, the results are important. They indicate that, for people inclined to take such a survey, basic economic enlightenment is not correlated with going to college.”

    Now this may not be a interesting (or true) argument, but it certainly does not rely on the flawed notion of enlightenment that the survey instrument itself does.

    BTW, I just took the test and it turns out I am enlightened (I just knew it!).

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  2. Martin Hart-Landsberg May 11, 2010 at 6:19 am

    Cliff,

    You are correct that the authors are aware of possible bias issues in the questions they used for determining enlightenment. The main example they cite: “an asymmetry in sometimes challenging leftist mentalities without ever specifically challenging conservative and libertarian mentalities.”

    But this reinforces just how blind they are to their own ideology. In the text they say that this bias could have been corrected by asking additional questions. Quoting the authors: “None of the questions challenge the economic foibles specifically of ‘conservatives,’ nor of ‘libertarians,’ as compared to those of ‘liberals’/’progressives.’ It would have been good, for example, if a question had asked about negative consequences of drug prohibition, or the positive consequences of increased immigration from Mexico.”

    What this reveals is that the authors still don’t recognize that the problem of bias is much more reflected in their determination of the correct answers to the questions they chose rather than the questions themselves. In other words, they cannot see that they are bringing a political bias to their work when they judge a person unenlightened who thinks that free trade leads to unemployment.

    And as for the relationship between education and enlightenment—their work just shows that economics education unfortunately tends to reinforce the dominant free-market ideology. People learn more sophisticated techniques as they study more economics—without developing a more critical perspective.

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