Laymen’s Economics
The Survey of Americans and Economists on the Economy finds that, compared to the experts, laymen are much more skeptical of markets, especially international and labor markets, and much more pessimistic about the past, present, and future of the economy. When laymen see business conspiracies, economists see supply-and-demand. When laymen see ruinous competition from foreigners, economists see the wonder of comparative advantage. When laymen see dangerous downsizing, economists see wealth-enhancing reallocation of labor. When laymen see decline, economists see progress.
Controlling for income, income growth, job security, gender, and race only mildly reduces the size of the lay-expert belief gap. And, since the typical economist is actually a moderate Democrat, controlling for party identification and ideology makes the lay-expert belief gap get a little bigger.
The data show that no matter how much you know about a voter’s material interests, it is hard to predict how he is going to vote. In contrast, if you know what a voter thinks is best for society, you can count on him to support it.
The Survey asks respondents to say whether “too many immigrants” is a major, minor, or non-reason why the economy is not doing better than it is. 47% of non-economists think it is a major reason; 80% of economists think it is not a reason at all. Since immigrants are largely young males, and most government programs support the old, women, and children, immigrants wind up paying more in taxes than they take in benefits. (See Ronald Lee and Timothy Miller “Immigration, Social Security, and Broader Fiscal Impacts” and Julian Simon The Economic Consequences of Immigration.)
Virtually every survey finds that a solid majority of Americans wants to reduce immigration, and almost no one wants to increase immigration.
The data show that well-educated voters hold more sensible policy views. (In “What Makes People Think Like Economists?,” Caplan estimates that each step of education on a 1-7 scale has 9.3% as much effect on economic beliefs as a Ph.D. in economics.)